Legal Question in Bankruptcy in California

Re: Credit Card

Whether or not you should file for bankruptcy depends on a lot of things: what type of debt you have, what your income and expenses look like, whether your property can be protected, among other things. These are issues that typically are reviewed at the initial consultation you have with an attorney. Many attorneys offer free initial consultations (myself included). The BK will be on your credit report for ten years, but that doesn't mean you won't be able to qualify for new credit much sooner than that--it's a case-by-case situation.

Stephanie Morris

415.495.2224 or 510.893.0700

Re: Credit Card

You have asked all the right questions but it is not really possible to post a complete answer here. It really depends on many other factors beyond the ones you list, such as the types of assets you own, if you are married, etc. etc. Most of us are willing to give a free or low cost consultation to address your questions and that would be your best course at this time.

Re: Credit Card

If you qualify for a chapter 7 bankruptcy, your unsecured debts, like credit card debts, will be discharged with some exceptions. In a Chapter 13, you pay back a portion of the debt (as payment in full) over 3-5 years--the repayment amount is based on your income and necessary expenses.

You can reaffirm the credit cards you want to keep, meaning you'll keep the card but also keep the debt on the card--it's up to the credit card company as to whether they'll keep you--they often will cut the credit limit, but also offer to cut some of the balance due as well to entice you to reaffirm.

Also, if you have a zero balance on a card or pay it off every month, you don't have to list that card in the bankruptcy.

The bankruptcy will stay on your credit report 7-10 years, although you can start rebuilding your credit immediately after the discharge, and this will take less than 7-10 years. Deciding to file is usually based on whether you have another way out--can you repay the debts without filing, or negotiate them? If not, bankruptcy may be a better option.