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While most consumers in Tacoma call our offices in the hopes of filing Chapter 7 bankruptcy, many of them are surprised to find out that under some circumstances Chapter 13 Bankruptcy in Washington will save them a whole lot more money. Why is that?
 
Chapter 7 is thought of as a quick opportunity for a fresh start. This is usually true, well, at least with respect to your unsecured creditors. Chapter 13 bankruptcy, on the other hand,  is thought of as a repayment plan where you pay everyone back. This is rarely true.
 
When it come to filing Chapter 13 bankruptcy in Tacoma, the thought is why in the world would I want a repayment plan if I can eliminate everything quickly and just get a fresh start? The answer in short is that you probably aren’t going to pay much, if anything, back to your unsecured creditors and you might do considerably better with your secured creditors, like car and home lenders, and your priority creditors, like the IRS, in Chapter 13.
 
In a recent blog post, I went over the some of the advantages that Chapter 13 Bankruptcy offers to Tacoma consumers with respect to past due or ongoing debts that can’t be eliminated in a Chapter 7. These benefits include having a mechanism to pay back tax, child support and mortgage arrears interest free and without penalty over a long period of time, reducing the principal and interest on car loans and the like. But there are other advantages that I wanted to mention as well.
 
First, from a practical standpoint Chapter 13 is just simpler and often more affordable to get filed. Our firm charges only $500 to get your case filed and that includes the filing fee for the court and the cost of a credit report to download your creditors. After the case is filed, the remainder of your attorney and trustee fees are simply deducted from your plan payment. No need to worry about coming up with a ton of money to get a case filed or make arrangements to pay money afterwards. Financing the filing of a Chapter 13 bankruptcy is simply cheaper and simpler than trying to file a Chapter 7.
 
Second, if you have lost your drivers license due to unpaid run-of-the-mill tickets, Chapter 13 bankruptcy will often able you to get it back very quickly after your case is filed. Many of our clients file Chapter 13 bankruptcy in Tacoma and walk into a Pierce County DMV the same week to get their license back. No more trying to dig yourself out of a big financial hole to get it back, just bring your filing information to the DMV window and you are legally back on the road.
 
Third, let’s say your house is underwater such that you owe more on your first mortgage than the house is worth. If that’s the case, we can eliminate the second mortgage, just slice it off your home.
 
Fourth, Chapter 13 is a much more flexible tool for dealing with debt. You can only file Chapter 7 every eight years. So what if you file Chapter 7 bankruptcy now and then two years from now through no fault of your own, you rack up more medical debt than you can handle, or you get laid off or divorced? The debt starts to add up.
 
The problem is that if that happens you won’t be able to afford a Chapter 13 Plan Payment and you won’t be eligible to file Chapter 7. No one ever thinks this will happen to them, but we see it happen all the time. Here’s the advantage of Chapter 13. When you are in a Chapter 13 and you rack up more debt and you can no longer afford to be in it, you can convert your case into a Chapter 7 and include all the debt that has arisen since the date of the Chapter 13 filing. In other words you file Chapter 13 Bankruptcy in 2015, rack up additional debt in 2018 and add it to the same bankruptcy once it is converted to Chapter 7.Now that’s safety.
 
Finally, Chapter 13 Bankruptcy in Washington is simply a smoother process than Chapter 7. The Chapter 13 Trustee doesn’t sell off your house if there is too much equity in it, the Chapter 7 Trustees can and will sell it off. The fact is that Chapter 13 Bankruptcy is a gentler smoother process than Chapter 7 Bankruptcy.
 
The Chapter 7 Trustees in Tacoma are extremely professional, but they are in a very real sense your adversaries. If they can sell off your home or your wedding ring within the boundaries of the bankruptcy code, they will. In contrast, the Chapter 13 Trustee knows that if your plan doesn’t work for you, you will just  dismiss it two months after filing and that doesn’t work for anyone. The process requires the Trustee to take a more collaborative approach rather than an adversarial one.
 
Again, Chapter 7 is well worth considering but it is not always the be-all-end-all solution for debt relief. If you have any questions at all about the relative merits of Chapter 7 and Chapter 13 Bankruptcy in Washington, please contact our Tacoma office at xxx-xxx-xxxx to set up an appointment with one of our attorneys. We would be happy to help.
 
In this article, I am going to discuss some other advantages of filing Chapter 13 bankruptcy rather than Chapter 7
 
Because Chapter 7 bankruptcy normally provides a total discharge of unsecured debt, it is definitely fair to ask how is it possible that a Tacoma bankruptcy filer could possibly end up doing better in a Chapter 13 bankruptcy than in a Chapter 7 Bankruptcy.
 
The reality is that Chapter 13 Bankruptcy in Washington is often misunderstood as a repayment plan that requires repayment of all your debt over a period of time. The reality is that in many Tacoma chapter 13 plans, the only creditors that get paid back are the car and home lenders. This is where the Chapter 13 advantages come in.
 
If your house is in default or in foreclosure, Chapter 13 Bankruptcy in Washington gives you a way to catch up interest free over a long period of time. Chapter 7 doesn’t give you time to catch up or give you time to refinance. In fact if you are behind and you want to keep your house, an aggressive Tacoma Chapter 7 Trustee might still pressure you to do a short sale.
 
If your car meets certain criteria, Chapter 13 may allow you to actually reduce the amount that you have to repay to the amount the vehicle is worth. No more repaying $20,000 for a $10,000 car. If your interest rate is over 5% you can get it reduced to that amount.
 
Maybe the most important thing is you are no longer locked into the loan. In Chapter 7 bankruptcy, you will likely have to sign a reaffirmation agreement to keep the car that locks you in the loan until the day is paid off. In contrast, Chapter 13 bankruptcy allows you to keep the car until you decide that it no longer works for you. Much safer and much better.
 
Finally, if you are behind on your child support or your taxes, Chapter 13 gives you a way to catch up on those debts.
 
Chapter 13 Bankruptcy in Washington many offers many other advantages to the Tacoma bankruptcy filer that I will address in another article. This is not to say that there is anything wrong with Chapter 7 bankruptcy at all, just that we should not assume that it is always the best option.
Flexibility: you can dismiss the case at any time with notice or even convert it to a Chapter 7. You can modify a plan if income changes or you decide to give up a house or a car. You can refinance or sell a house during the plan.
A Chapter 13 Bankruptcy in Washington will save a house from foreclosure as long as you can make the payments.
You can strip a wholly unsecured second mortgage; or value a car if you’ve had it more than 910 days.
You can challenge the costs added to your mortgage by the lender.
Trustees want the plan to succeed and will work with you to get it confirmed.
Your attorney’s fees can be spread out rather than all due before filing.
You can avoid having to reaffirm a car in order to keep it.
You can cure a tax problem or a Domestic Support Obligation (child support or alimony) over 60 months.
You can stretch out your payments for a car or other secured debt and propose a reduction in the interest rate.
You won’t lose non-exempt property.
Depending upon your income a Chapter 7 case can be challenged by the US Trustee, but not a Chapter 13.
Schedule a Free Consultation with Your Tacoma Bankruptcy Attorney
When it comes time to file for bankruptcy, you need a compassionate and skilled attorney who will be able to guide you through the process as cleanly as possible. Northwest Debt Relief Law Firm, we can help you with filing for Chapter 7, Chapter 11, and Chapter 13 bankruptcy in Washington State.  We will be there every step of the way to help navigate you through the often-complex and difficult bankruptcy process.
 
Give us a call at (253) 780-8008 to schedule a free consultation with one of our bankruptcy attorneys. If you have any other questions about bankruptcy, one of our attorneys will be more than happy to offer advice on your particular situation.
The post How Chapter 13 Bankruptcy in Washington Can Be More Beneficial Than Filing for A Chapter 7 Bankruptcy appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief.

Bankruptcy may make sense if you are unable to repay debts as you cover obligations such as retirement, food and shelter. With so many websites offering free financial tools, it can be hard to know whom to trust. At Northwest Debt Relief Law Firm, we thoroughly research financial products and companies, and adhere to strict standards of editorial integrity to find you the best Bankruptcy Lawyer.
Bankruptcy stops collection calls, lawsuits and wage garnishments. It erases debt. And despite what you’ve heard, bankruptcy may help your credit scores.
Credit bureaus and scoring experts often say bankruptcy is the single worst thing you can do to your scores. Foreclosures, repossessions, charge-offs, collections — nothing else can drive your scores down as fast and far as a bankruptcy. Most people have credit already battered by the time they file for bankruptcy. And once they do, their scores typically rise, not fall.
But that’s not the whole story. Most people struggle so long with their debt that their credit is already battered by the time they file for bankruptcy. And once they do, their scores typically rise, not fall. If the debt is erased — which is known in bankruptcy court as a “discharge” — scores go up even more.
 
How much and how soon credit scores can rise
Using data from Equifax credit bureau, researchers at the Federal Reserve Bank of Philadelphia found that filers’ Equifax credit scores plunged in the 18 months before filing bankruptcy and rose steadily afterward.
 
Among the findings:
The average credit score for someone who filed Chapter 7, the most common type of bankruptcy, in 2010 was 538.2 on Equifax’s 280 to 850 range. (Scores in the low 600s and below are generally considered poor.) By the time the filers’ cases were discharged, usually within six months, their average score was 620.3.
The other type of bankruptcy, Chapter 13, requires a three- to five-year repayment plan, which most people don’t complete. (Half of Chapter 13s filed between 2007 and 2013 were dismissed, and an additional 12 percent were converted to Chapter 7s or other types of bankruptcy, according to an American Bankruptcy Institute analysis of Justice Department figures.) Those who did and got a discharge, though, saw their scores rise from 535.2 to 610.8, the Philadelphia Fed researchers found.
A recent study by FICO, the company that created the leading credit score, found much smaller gains. Median credit scores for people who filed for bankruptcy between October 2009 and October 2010 rose from the 550s before they filed to the 560s afterward, says Ethan Dornhelm, senior director for FICO’s scores and analytics group. (Most FICO scores are on a scale of 300 to 850.)
 
After two years, 28% of bankruptcy filers had scores of 620 and above. After four years, 48% had scores of 620 or above, and only 1% scored 700 or above.
But the FICO study didn’t distinguish between Chapter 7 and Chapter 13, or between people who got a discharge and those who didn’t. Those with undischarged debt could be skewing the results. In other words, people with completed bankruptcies could have seen bigger gains than what’s reflected in the median figures, Dornhelm says.
 
Saving your credit score is only one reason
Credit scores aren’t the only factor to consider, of course. Some of the others:
An end to collection hell: Nosal’s study found that once people fell seriously behind on their debt — with at least one account 120 days overdue, for example — their financial troubles tended to get worse. Balances in collections and the percentage of people with court judgments grew.
By contrast, people who file for bankruptcy benefit from its “automatic stay,” which halts almost all collection efforts, including lawsuits and wage garnishment. If the underlying debt is erased, the lawsuits and garnishment end.
Freedom from certain debts: Chapter 7 bankruptcy wipes out many kinds of debt, including:
Credit card debt.
Medical bills.
Personal loans.
Civil judgments (except for fraud).
Past-due rent.
Past-due utility bills.
Business debts.
Some older tax debts.
Some debts, including child support and recent tax debt, can’t be erased in bankruptcy. Student loan debt can be, but it’s very rare. But if your most troublesome debt can’t be discharged, erasing other debts could give you the room you need to repay what remains.
Your credit limits after bankruptcy are likely to be low, however, and your access to credit — like your credit scores — won’t recover completely until a Chapter 7 bankruptcy drops off your credit reports after 10 years. That’s a long time in the penalty box. But let’s dispense with the idea that people facing bankruptcy are choosing between paying their bills and not paying their bills.
 
 
When to stop digging a hole you can’t escape
Most of us feel we have a moral obligation to pay what we owe — if we can. But typically that ship has sailed by the time people realize they need to consider bankruptcy. They can continue trying to chip away at debts they may never be able to repay, prolonging the damage to their credit scores and diverting money they could use to support themselves in retirement. Or they can recognize an impossible situation, deal with it and move on.
Most of us feel we have a moral obligation to pay what we owe — if we can. But typically that ship has sailed by the time people realize they need to consider bankruptcy.
If you can pay your bills, obviously you should. If you’re struggling, check out your options for debt relief. But bankruptcy may be the best option if your consumer debt — the kinds listed above that can be erased — equals more than half your income, or if it would take you five or more years to pay off that debt even with extreme austerity measures.
 
Here’s what you need to know:
You need a bankruptcy attorney: It’s easy to make a mistake in the complicated paperwork, and an error could cause your case to be dismissed. If that happens, you end up with no relief — but still have credit scores tanked by the bankruptcy filing.
If you’re still paying your credit cards and other consumer debt, you could stop and redirect the money to pay for an attorney. Another option is to borrow from friends and family. Don’t open new credit accounts to borrow the money, though, since that could be considered fraud. Discuss your options with an attorney.
Don’t wait too long: There’s a misconception that people file bankruptcy at the drop of a hat or when they still have other options. The reality for most is quite different. Some drain assets, such as their retirement accounts, that could have been protected from creditors in bankruptcy. People throw good money after bad until they have no money left to seek relief.
Schedule a Free Consultation with Your Portland Bankruptcy Lawyer
When it comes time to file for bankruptcy, you need a compassionate and skilled attorney who will be able to guide you through the process as cleanly as possible. Northwest Debt Relief Law Firm, we can help you with filing for Chapter 7, Chapter 11, and Chapter 13 bankruptcy in Portland, Oregon.  We will be there every step of the way to help navigate you through the often-complex and difficult bankruptcy process.
Give us a call at (503) 912-8809 to schedule a free consultation with one of our bankruptcy attorneys. If you have any other questions about bankruptcy, one of our attorneys will be more than happy to offer advice on your particular situation.
The post When Bankruptcy Is the Best Option and Finding the Right Bankruptcy Lawyer appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief.

By David Lumb

As part of the budget that New York lawmakers passed last Friday, ride-hailing services and taxis face a new fee if they drive in Manhattan. These aren't nickel-and-dime increases, either: Uber, Lyft and the like face a $2.75 charge for each ride, taxis get a $2.50 increase and group ride services like Via and uberPOOL will be charged $0.75 per customer. It's meant to combat congestion and help fund subway repair and improvements, providing an expected $400 million per year going forward for the MTA.

Unsurprisingly, it's already catching flak from customers and from taxi drivers, who have become far
outnumbered by ride-sharing cars in the last several years. Of the 103,000 vehicles for hire in NYC, 65,000 are driven by Uber contractors alone, while taxis remain capped by law at 13,600, The New York Times reported. As a result, average traffic in Manhattan has slowed from 6.5 miles per hour to 4.7.

"It'll hurt our business. People won't want to pay more money, and that's what's going to happen," taxi driver David Heller told NY1. "There's 130,000 Ubers, ok? They created the congestion, ok? Get rid of them."

Other cities have enacted their own surcharges for ride-hailing services in recent years, but they are far lower than those New York just passed. Seattle instated a $0.24 charge for each trip in 2014, Portland, OR agreed to levy a $0.50 fee per customer in 2016, both of which funnel money collected toward regulating ride-sharing services. Chicago passed one in 2014 that will reach $0.65 this year and directs part of the funds raised toward public transit, much like New York's will.

When reached for comment, both Lyft and Uber supported the surcharge but pushed for a broader fee plan affecting all vehicles: "Congestion will not be fully addressed until the Governor and Legislature enact a comprehensive plan that also addresses all commercial vehicles and the real issue driving congestion: personal vehicles," a Lyft spokesperson told Engadget over email.

"Uber supports the agreement between the Governor and the Legislature to target a per-trip fee on Manhattan riders where there is convenient access to public transit, and to adopt a first-in-the-nation tax discount on shared trips. We will continue to advocate for the adoption of a comprehensive congestion pricing plan that is applied to all vehicles because it is the best way to fully fund mass transit and reduce traffic in the central business district," read an Uber statement the company emailed to Engadget.

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There are many reasons why people file for bankruptcy and below are the common mistakes to avoid when filing for Bankruptcy in Washington. From credit card debt, to loss of income, to a divorce—bankruptcy is an effective, legal way to help you get back on your feet financially. When it comes time to file for bankruptcy in Washington State, there are a few things you need to keep in mind to prevent unnecessary complications.
 
When it comes to Chapter 7, Chapter 13 or Chapter 11, keep in mind that you’re not going to be able to fool the court or cleverly hide your assets. Millions of people have filed bankruptcy and the legal system has seen and heard it all. There is a 100% chance you will cause more harm than good if you attempt to pull a fast one over the court.
 
Disclose Everything to Your Tacoma Attorney
Without a doubt, this is one of the most important aspects that many people tend to overlook. The reason you hired a bankruptcy attorney is to help guide you through the Washington bankruptcy process. As such, you need to disclose everything regarding your income, assets and financial status.
 
The advice you receive from experienced and trusted attorney is based upon the particulars of your unique financial situation. If you’re withholding information, it could come back to bite you at a later point in time. You should also be aware that the bankruptcy process requires you to disclose everything to the court – your assets, debts, income, creditors and even multiple prior years of financial history prior to the bankruptcy filing.
 
Do Not Repay Relatives or Insiders
In the eyes of the court, your relatives do not have any special legal status that puts them in a protected class above your other creditors. Prior to filing Washington bankruptcy, do not repay any loans your relatives may have given you. Otherwise, the bankruptcy trustee can come after your relative in pursuit of the money you paid them. They will then redistribute those monies to the same-class creditors.
 
An “insider” is considered to be a friend, business associate or a creditor whom you might have a favorable relationship with. You can’t pick and choose who gets paid off first. That is up to the trustee to manage the disbursements.
 
Do Not Incur Any Additional Debt
Once you have made up your mind to file for bankruptcy, do not incur any additional debt that you don’t intend to repay in full. This includes using your credit card to buy a $5 latte at the local coffee shop. The court may deny your right to cancel the debt in bankruptcy, or they could view it as a criminal matter.
 
Don’t Pull Money from Retirement Accounts
Retirement funds are usually protected in bankruptcy procedures. The court may allow you to discharge your debt without coming after your retirement fund. Avoid touching those monies unless it’s absolutely necessary. The court recognizes that a retirement fund is there to help you live once you retire.
 
Don’t Transfer Property
Transferring property out of your name will not prevent the trustee from taking it from you. If you transferred property to a relative, the trustee will come after the relative in order to gain possession of the property. It’s best to not transfer anything out of your name, prior to getting legal advice.
 
Schedule a Free Consultation with Your Tacoma Bankruptcy Attorney
When it comes time to file for bankruptcy, you need a compassionate and skilled attorney who will be able to guide you through the process as cleanly as possible. Northwest Debt Relief Law Firm, we can help you with filing for Chapter 7, Chapter 11, and Chapter 13 bankruptcy in Washington State.  We will be there every step of the way to help navigate you through the often-complex and difficult bankruptcy process.
 
Give us a call at (253) 780-8008 to schedule a free consultation with one of our bankruptcy attorneys. If you have any other questions about bankruptcy, one of our attorneys will be more than happy to offer advice on your particular situation.
The post COMMON MISTAKES TO AVOID WHEN FILING FOR BANKRUPTCY IN WASHINGTON appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief.