Can I file bankruptcy for credit card debt only? This is a question that is commonly asked.
Financial miss-calculations or unforeseen events or conditions can befall anyone, leading to difficulty with repayment of credit card debt. The average household credit card debt continues to be on the rise.
Estimates have it that the average American household credit card debt is now between $3,600 to $9000 depending on how the debt is measured.
Filing bankruptcy for credit card debt is a decision that many must make.
If you find yourself in that situation, do not despair. While declaring bankruptcy is the very very last option anyone should take, if you have to, then you have to.
Bankruptcy laws allow anyone who cannot honestly pay off debts they owe, "a new opportunity in life and a clear field for future effort unhampered by the pressures and discouragement of pre-existing debt". It is literally designed to help give you a clean start again.
Though there are strict rules and regulations that governs the bankruptcy process, it truly protects those who genuinely do not have the means or ability to pay back what they owe, and this certainly includes your credit card debt.
In 2005, President George W Bush signed into law a new bankruptcy law called the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 - BAPCPA .
This is new law is designed to make it harder for people who can truly repair their debt to take advantage of the system and declare bankruptcy.
It mainly allows for one of two routes to declare bankruptcy:
Many will not be able to file Chapter 7, but will need to file Chapter 13 instead.
Chapter 13 requires that the debts not be discharged but simply restructured.
Credit card debts are seen as unsecured debts or claims and are allowed to be discharged or written off under any of the two types of bankruptcy routes. So. Yes. You can file bankruptcy for credit card debt under chapter 7 or chapter 13 bankruptcy act if you are in the USA and certainly so in Canada and the UK as well as many other countries, as long as you meet some preconditions.
Before you get your credit card debt written off under the bankruptcy laws though, you must be able to establish that:
In addition, consumer credit counseling is necessary. The new bankruptcy act requires all who are thinking of filing bankruptcy for credit card debt or indeed any type of debt to undergo compulsory consumer debt counseling and get help and advice on how they can pay off their debt or at least best manage it in the six months before they actually file for bankruptcy.
Filing bankruptcy for credit card debt should be the very last resort for you, no matter how much your debt is.
With the right advise and step, you can get most of your debt written off without resorting to bankruptcy.
Before going about how to file bankruptcy for credit card debt, we recommend that you read this book by Kenny Golde titled: Do-It-Yourself Bailout: How I Eliminated $222,000 of Credit Card Debt in Eighteen Months and Saved Nearly $150,000.
You will learn valuable tips and practical ways to eliminate the most frightening credit card debts you could ever accumulate.
Another resource that can help you eliminate your credit card debt is an eBook by John Oswald that reveals a step-by-step procedure you can start implementing right away to help eliminate your credit card debt, including help with budgeting, contacting and negotiating your credit card and IRS debts, why you should and how to avoid bankruptcy, dealing with debt collectors, lawsuits, and credit repair by yourself. You can get this Complete Debt Relief Manual eBook online here.
If you are convinced that you have no option than to declare bankruptcy on your credit card debts, here is how to go about it:
Yes. Filing bankruptcy for your credit card debt is possible. Consider deeply though if this is the best solution for you and how it would affect you and your credit score as well as ability to borrow in the near future.
Doing it right, filing bankruptcy for credit card debt could the best decision and way out of unsecured debts, including credit card debts.