DISCLAIMER: The information on this website is meant for educational and informational purposes only and is not intended to constitute legal advice or financial advising. If you need solutions to your financial problems, please call now to schedule your free 30-minute consultation with one of our bankruptcy attorneys in Charlottesville or Culpeper, VA.
Many people don’t realize that filing bankruptcy can actually stop wage garnishments – and can often even get their garnished money back.
Time is of the essence if you want to get garnished money back, though. So if your wages are being garnished, we invite you to schedule a free a consultation with one of our lawyers as soon as possible so we can analyze your situation and have the best possible chance of getting the money back for you.
A home foreclosure sale can generally be stopped by filing bankruptcy.
Foreclosures are similar to garnishments in that time is of the essence. To be effective in saving the house, a bankruptcy must be filed before the date and time of the foreclosure sale. If your home is scheduled for foreclosure, it’s important that you come into our office for your free consultation immediately so we can lay out your most workable options.
If you are behind on your mortgage payments and are worried that your home will be foreclosed in the future, it’s best for you to come into our office for a free consultation before the home is actually scheduled for foreclosure. This will give your more time and, potentially, more options.
Filing bankruptcy can stop a repossession. If you want to keep your car, one good option may be to file a Chapter 13 in order to catch up on the missed payments.
This is usually possible if you file bankruptcy before the vehicle is sold by the creditor – so time is of the essence. We invite you to schedule your free consultation with one of our lawyers as soon as possible so we can show you your options. You may be able to refinance the car or develop a payment plan, depending on your situation. At your consultation, you’ll discover what might work best in your particular situation.
No. If you are currently experiencing difficulty handling your debt load, our lawyers are happy to help you figure out your options no matter how much (or how little) debt you have.
If the amount of your debt is small enough in relation to your income we can help you analyze whether the best decision would be to try to pay it off yourself or with the help of a friend or relative. Or, depending on your particular circumstances, we might recommend a good credit counseling agency for you. If the debt is more significant, we will let you know about other options we see, including various ways bankruptcy might be able to help.
Because our lawyers have seen so many cases of people dealing with debt, they have the ability to help you discover what may or may not work in your particular situation.
When you are in debt, dealing with creditors constantly calling you can be a real hassle. And it doesn’t seem to stop.
If you file bankruptcy, creditors calls stop immediately because of something called the “automatic stay” in bankruptcy law. The automatic stay requires creditors to stop calling anyone who has filed bankruptcy. It is almost like magic and it contributes a great deal to our clients finding peace of mind.
No, please do not do this. It may seem like a good idea, but it is very risky and can suck you in to a really bad cycle of debt that is hard to escape.
How? These types of loans usually carry an extremely high interest rate – to the tune of 400%, which is outrageous. You must also agree to pay them back in a very short period of time, usually just 2-4 weeks. If you don’t pay them back on time, you are socked with other charges, making it harder to pay back the following month.
If you are considering a Payday Loan, come into Slayton Law for a free appointment instead. We will help you sort through what is going on for you and try to come up with other, better options.
If you struggling, using credit cards that you can’t pay off every month, we suggest you come into our office for a free consultation. Depending on your circumstances, there may be options that could help you that you don’t even know about.
We advise you not to do this, unless your debt load is quite low (maybe $1,000-2,000 max). Even then, using a debt settlement company can be a very risky option.
Why? The way debt settlement companies work is that they negotiate with your creditors for you to pay back a percent of what you owe, instead of the full amount. Why wouldn’t anyone want to work with a debt settlement company to do this?
Here’s why: Let’s say the debt settlement company negotiates that you only have to pay 60% of the total amount you owe. That means you save 40% of your total debt, right? Wrong. You will have to pay the debt settlement company part of that 40% to cover their fee. Debt settlement companies generally charge anywhere from 15-25% of the total amount you owed to begin with. So you’re 40% minus the debt settlement company’s 15-25% fee. Still, it’s a savings. But is it, really?
No. That 15-20% of debt you “saved” will now be counted as income to YOU. And you will be required to pay income taxes on it. That’s right. If you originally owed $100,000 in debt and the debt settlement company got you out of paying $25,000, the IRS will count that $25,000 you “saved” as your income. If you are in the 20% tax bracket, you will wind up having to pay $5,000 in taxes on what you “saved.” How will you come up with that $5,000? It’s like going into debt all over again.
Furthermore, if you use a debt settlement company, your credit score will take a huge hit. Why? A couple of reasons. One, you are not paying back all of your debt. Two, debt settlement companies advise you to stop making payments on all of your debt so they can take that money and use it to negotiate a discount. When you stop paying your debts, your credit tanks and your creditors will lilkely start calling you non-stop. Not only that, but you will also rack up late fees and additional interest.
Filing bankruptcy prevents all these issues because the Federal Bankruptcy laws provide important protections for consumers. Your debt is “negotiated” by your bankruptcy attorney so it is either radically reduced or completely eliminated (in most cases, you will pay far less than you would have had to using a debt settlement company). And, unlike debt settlement companies, this savings is not considered income to you and you will not have to pay taxes on it.
Moreover, bankruptcy laws give you the “automatic stay,” which prevents your creditors from calling and harassing you. Debt settlement companies cannot provide this peace of mind to you.
Finally, while your credit score has been pretty dinged up by the time you decide to file bankruptcy, 95% of our clients credit scores actually go up in the year after they file bankruptcy!
In sum, in bankruptcy, consumers generally have to pay back less of their debt, do not have to pay taxes on what they save, and receive an automatic stay that stops creditors from calling. And it’s usually better for one’s credit score.
For all these reasons, we recommend avoiding debt settlement companies.
Credit counseling agencies are very different than debt settlement companies. At Slayton Law, we think getting credit counseling is always a good idea. In fact, if you file bankruptcy, you are required to take a credit counseling class. So we have no problem with it at all.
But it’s important to know what credit counseling agencies can and cannot do for you. They can work with your lenders to negotiate lower interest rates and get late fees waived. And they can work with you to try to develop a plan for repaying your debt using your income.
Credit counseling agencies cannot, however, negotiate any reduction or elimination of your debt. Often, by the time a person seeks credit counseling, the amount of their debt is too high in relation to their income to be able for the credit counseling plan to help.
Credit counseling companies often refer people in this situation to seek advice from experienced debt relief and bankruptcy attorneys, like those at Slayton Law.
Chapter 7 bankruptcy is what some people call “Straight Bankruptcy” or “Liquidation Bankruptcy.” It is a way to get rid of your unsecured debts (things like credit card debt, medical bills, personal loans, payday loans, etc.) and get a fresh start in life. It is often used when a person doesn’t own a lot of property, or the property they do own doesn’t have much equity.
A Chapter 7 bankruptcy is also fast – it’s usually complete within 90 days.
Chapter 13 has also been called a “Payment Plan Bankruptcy” or a “Wage Earner Bankruptcy.” It is a way to pay back some or all of your debt over time out of your wages. It is a great way for people who are behind on their mortgage or car payments to get caught up. We often use Chapter 13 to help save a client’s house from foreclosure.
Chapter 13 is often used by people who own a good amount of personal or real property, because Chapter 13 allows you to keep all of your property. You and your attorney will develop a payment plan that allows you to pay back all or a portion of your debt over three to five years.
Another benefit of Chapter 13 is that attorneys fees can be included as part of your payment plan. This means the upfront cost of a Chapter 13 can be quite low.
It depends on your particular circumstances. If filing bankruptcy is an option you wish to consider, we can give you the exact cost after we meet with you as part of your free 30-minute consultation.
We work hard to make sure that if bankruptcy is the best option for you, it is also an affordable option for you.
We accept debit cards, payments from friends and relatives, low up-front costs when payments are rolled into your Chapter 13 payment plan, and are 100% willing to work with you on a payment schedule that fits your needs.
We firmly believe that excellent, experienced, and ethical legal representation should be affordable to anyone who is struggling with debt.