Credit Cards in a Bankruptcy

Credit Cards and Bankruptcy

Alabama Bankruptcy Attorneys helping discharge credit card debt in Pelham, Alabaster, Fultondale, and the rest of North Alabama

Credit card debt is one of most common causes pushing people into bankruptcy in Alabama. Debtors find themselves unable to make more than the minimum monthly payments, and the interest piles up until the debtor realizes he has nowhere to turn. Credit card debt is the main source of unsecured debt in bankruptcy, and after a Chapter 7 liquidation of the debtor’s assets, the unsecured creditors line up for a pro rata distribution before the remaining debt is discharged (the infamous “ten cents on the dollar” you’ve probably heard about). Credit card debt is dischargeable under Chapter 7, and may be paid under a court-approved payment plan under Chapter 13.  Often, bankruptcy discharge is the best option for a debtor who has become unable to pay mounting credit card debt. However, a bankruptcy filing stays on a debtor’s credit rating for a period of at least 7 years thereafter, making future credit harder and more expensive to obtain.  However, it doesn’t make it impossible.

If your credit card debt is becoming unmanageable and debt collection agencies are hounding you at every turn, you have options. An experienced bankruptcy attorney can advise you on matters both inside and outside of bankruptcy, and help you make the best choice moving forward. Our Birmingham Legal Team includes bankruptcy attorneys with years of experience in helping their clients through difficult periods of their lives such as bankruptcy.  Let us put our experience to work for you today – contact us at 205-502-2000 for a free consultation.