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Dayton Bankruptcy Law Blog

Debtors have rights when dealing with debt collectors

Ohio consumers who owe past due debt balances may be contacted by a debt collector. However, this doesn't mean that an individual will be required to make a payment. Furthermore, it is also possible that a person is contacted about a debt that he or she doesn't actually owe. If a debt collector does call, an individual has the opportunity to verify that the balance owed is correct and that it can still be collected.

Typically, state law imposes a statute of limitations on debt collectors, and that statute of limitations is generally four or six years. However, the clock begins the moment that a person makes a payment on that debt balance. Therefore, if a person makes a partial payment on an old debt, it may give debt collectors or other parties more time to take that person to court.

Will your creditors come to question you at the 341 meeting?

If you struggle with mounting debt and have finally decided to file for bankruptcy, you will soon attend the 341 meeting, also called the meeting of creditors.

This is basically a hearing that creditors are welcome to attend. However, of most importance to you is that you will meet the trustee assigned to administer your bankruptcy case.

Bankruptcy and seniors: an increasing reality

Many people in Ohio may well grow up with the idea that they will work hard during the majority of their life and then retire at some point. Their retirement years are generally expected to be funded by savings, Social Security and maybe even some wise investments. Very few people expect that their retirement years could be marked by the most serious financial problems of their entire life. That, however, seems to be the case for more seniors today than in prior generations.

The Washington Post reports that reports show a dramatic rise in the number of people over 65 filing for bankruptcy. These filers have an average median net worth of approximately negative $17,400.

Can you be forced into bankruptcy?

Personal bankruptcy is a personal choice that you may consider if you are experiencing insurmountable financial difficulties. The option to pursue a Chapter 7 or Chapter 13 bankruptcy is yours alone – or so you may think. What if someone told you that your creditors may petition the court for your bankruptcy against your will?

Lenders may, in fact, request that those who owe them money be forced into bankruptcy, according to FindLaw. Fortunately, involuntary bankruptcy is rare for individuals, although you may be interested in learning how this action can benefit creditors. It does them no good to send collection notices and bills to debtors if they are ignored. However, when eligible assets are liquidated through Chapter 7 bankruptcy, the funds are used to repay creditors. Those who owe significant debt may have a higher chance of being pushed into involuntary bankruptcy than the average debtor.

Receive credit counseling before filing for Chapter 13

When Ohio residents realize they are in a difficult financial situation, they may consider filing for Chapter 13 bankruptcy. Many people may not know that before they file for bankruptcy, they generally have to receive credit counseling.

Credit counseling usually helps people understand their financial situation. The Consumer Financial Protection Bureau says that a credit counselor generally sits down with people to look over their finances. During these sessions, people may look at their credit report and the credit counselor might show people how to create a budget. People may also learn money management strategies. People typically meet with a counselor for about an hour.

Avoid foreclosure with a mortgage forbearance

When Ohio residents realize they cannot afford their current mortgage payments, they may worry that the bank will foreclose on their house. However, people may sometimes be able to get a mortgage forbearance to help them manage these payments.

People may find themselves unable to pay their mortgage for many reasons. The Consumer Financial Protection Bureau says these reasons include an unexpected injury or illness and home damage after a natural disaster. Some people may not be able to afford their mortgage if they lose their job or have to take fewer hours. In these situations, many people may be able to request a mortgage forbearance. Some people might think a forbearance means they no longer need to make these payments. This is not the case, though. People typically still need to pay their mortgage; however, they can usually pay a lower amount each month. In some situations, a lender may allow people to temporarily stop their payments. It is important to remember, though, that people generally have to continue making these payments later. A family's particular situation determines the type of forbearance a lender might offer.

Bankruptcy protections for military members

The thought of filing for bankruptcy can cause you fear and anxiety. Much of that probably comes from misinformation you have heard about bankruptcy.

The truth is that bankruptcy can be extremely helpful and relieving. If you are in the military, you may also receive certain benefits during the process.

Will debts remain after filing for Chapter 7?

As a resident of Ohio, you have several options to look into if you are considering filing for bankruptcy. For example, Chapter 7 bankruptcy offers relief from certain debts by allowing you to discharge them. However, it is crucial to note that not every debt you hold can be dismissed through bankruptcy.

FindLaw takes a look at the types of debt that can and can't be discharged by filing for Chapter 7 bankruptcy. Typically, most types of unsecured debt CAN be discharged. Unsecured debts are debts without an underlying loan asset and can include:

  • Credit card charges
  • Medical bills
  • Back rent
  • Utility bills like electricity or telephone

Who could benefit from Chapter 13 bankruptcy

Ohio residents who are considering filing for bankruptcy may also be wondering which type of bankruptcy will work best for them. Chapter 13 has many benefits, but it tends to work better for a certain set of people.

The United States Courts lists out the bankruptcy basics for Chapter 13. Known colloquially as a "wage earner's plan", this plan is ideal for people who are in a financial situation where they can make payments toward their debt. Debt is reorganized so that it is easier to pay off, but ultimately, it will be paid off. This differs from Chapter 7, in which items are liquidated in order to allow the individual to discard some of their debt.

What 5 things should you do after bankruptcy?

Now that your bankruptcy period has ended in Ohio, you likely want to reestablish your credit as quickly as possible. How you go about doing this, however, can make all the difference.

Here, per Credit.com, are the five steps — in order — that you should take.

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