Virginia residents and others who are dealing with credit card or other types of debt may consider filing for bankruptcy to eliminate existing balances. This may be especially beneficial for those who have limited incomes. However, other options exist that some people may want to consider as well. For instance, it may be possible to convince a creditor to forgive some or all of a debt, and this can be done either with or without an attorney. However, it is sometimes easier to get a favorable outcome with the assistance of legal counsel.
Of course, individuals could be required to pay taxes on the amount forgiven. This is generally not the case when a debt is discharged through Chapter 7 bankruptcy. Filing for bankruptcy can also be ideal for those who are looking to get out of debt quickly and start rebuilding their credit history. Most people can get a secured credit card as soon as their cases are complete.
In some cases, a person can rebuild his or her credit score in as little as two years. Creditors are generally willing to extend credit to those who have filed for bankruptcy because they no longer have any other debts to contend with. Furthermore, debtors cannot file for Chapter 7 bankruptcy for eight years after their last case has been discharged.
Filing for Chapter 7 bankruptcy may be a good solution for those who are trying to postpone a foreclosure or repossession. This is because doing so may grant a debtor an automatic stay from creditor collection activities. The stay usually goes into effect as soon as a case is filed and typically lasts until the matter is resolved. An attorney may explain what a stay is and how it may help a debtor.