LEGAL WAYS TO GET THE BILL COLLECTORS OFF YOUR BACK

LEGAL WAYS TO GET THE BILL COLLECTORS OFF YOUR BACK

Sometimes, the formal and legal declaration of personal bankruptcy is the best way to go

when you're "snowed under" with bills, and you just can't see your way clear to survive.

Actually, bankruptcy allows you to make a fresh start. Generally, it takes only a small amount

of money, a careful evaluation of your assets and your liabilities. In many cases, a lawyer is

not necessary.

If you have very few assets, mountains of debt, and not enough income to meet your

obligations, then your best bet is almost always the filing of straight bankruptcy. What you'll

need is the proper forms "S3010 Bankruptcy forms, for an Individual Not Engaged In

Business." These can be purchased from any full-line office supply store, especially in an

area serving attorneys' offices.

You'll need to know which district you love in for Federal Court purposes - so look in the white

pages of your telephone book under U.S. Government - Courts - and take down the address

of the nearest U.S. District Court. Check it out to be sure that your residence is in this court's

jurisdiction.

You then fill out the forms you purchased, listing all of your creditors - those with priority being

listed first - meaning those who have extended credit to you against some sort of security or

collateral, followed by those who have extended credit to you on just your signature or

reputation. You must be sure to list all of your creditors because any that you fail to list, will be

able to sue you and collect even after the bankruptcy has been adjudicated. At the same time,

be sure to include the names of anyone and everyone you may have co-signed a note or a

loan for, as well as anyone who may have co-signed for you.

The laws governing personal bankruptcy vary in all states, but generally, a bankruptcy

judgement will not take away the house you live in, basic home furnishings, a car that's

necessary towards your gainful employment, nor the tools of your trade. Check these things

out to be sure against the list of items regarded as the necessities of life by your state.

When you've got all the forms filled out, and notarized, you take them to the Clerk of the U.S.

District Court in your jurisdiction. You pay the clerk $50, and from there, you're home free.

The clerk notifies your creditors, and reminds them that being as you've filed bankruptcy

papers, they cannot bother you about your debts anymore.

However, they are invited to your hearing. Usually they don't show up, because by that time,

you have very few, if any, nonexempt assets left that they are really interested in., But,

whatever assets you do have that are nonexempt, will be sold by the Court to appease your

creditors. Any money realized from these sales is then added to the total amount of money

you may have turned over to the court at the time of your filing, and divided equally amongst

your creditors according to priorities.

After all of this has taken place, and usually about 3 months after you've been adjudged

bankrupt, you can start all over again to incur debt, pay bills and establish a new credit rating.

However , you should be especially careful about talking with your old creditors because they

may attempt to maneuver you into signing a "reaffirmation" of your old debt. The thing to do is

to be sure that you carefully read anything you affix your signature to, and don't agree to pay on

any debt that has already been discharged through your bankruptcy!

In some bankruptcy filings, it is definitely advantageous to hire an attorney to represent you.

This is especially try for people who have assets such as real estate they want to protect, and/

or people who has been operating home-based businesses or been accused of fraud.

Remember this, if you decide to process your bankruptcy without a lawyer, then it is your

responsibility to fill out all the necessary forms accurately and completely, and every bit as

precisely as if you had paid an attorney to do it for you. Leaving out a creditor's name or

address or forgetting a loan that you co-signed for, will surely bring on litigation against you

even after your bankruptcy has been adjudicated. Be sure you understand all the papers, ask

the Court Clerk for advice, and if you run into problems, then take it in to an attorney.

Besides the regular bankruptcy laws, there's also a little-known and little-used method of

getting reorganized with your debt, particularly when you've got a steady job and just need

more time to straighten your indebtedness out. This is the wage-earner's provisions of

Chapter XIII of the Federal Bankruptcy laws.

Basically, these provisions allow you to make new arrangements with your creditors and pay

off all your debts over a new 3-year period of time. When you filed for indebtedness relief

under the provisions of this law, nothing is recorded permanently on your credit record. You

get to keep all your assets, but you must pay off all your debts. But, so long as the Court

grants you relief under these provisions, and you pay your creditors according to the

repayment schedule agreed upon by the Court, your creditors cannot bother you. Even if they

have begun a suit against you, once the Court has given you relief, they cannot touch you!

Once you've filed under these provisions, your creditors are immediately restricted from even

contacting you, and get only what the referee or trustee doles out to them.

Often-times, if a creditor threatens to sue you, the most effective thing you can do is to tell him

frankly that if he sues you, you'll have no other alternative except to file bankruptcy papers. In

many instances, this will cause him to take a second look and to do whatever he can to assist

you in paying him the money you owe, but over a longer period of time, and at smaller monthly

payments. The absolute bottom line is that your creditors know only too well that if you do file

for bankruptcy, their chances of receiving even half of what you owe is practically nil. Thus, it's

in their best interest to do everything they can to help you to continue making payments on the

amount you owe, regardless of how small those payments may be.

When a creditor does sue you, and gets a judgement against you, he can then get a court

order directing the sheriff to seize your personal property and sell it, with all monies realized

going to the creditor to satisfy your debt. When they see this about to happen, many people

connive to make themselves "judgement proof." In other words, they hide their assets or

move them out-of-state before the sheriff or marshall arrives. This is illegal, but is done as

often as not.

Many creditors will attempt to "garnishee" your wages. This is done by getting a court order

directing your employer to set aside part of your wages or salary every pay period and turn it

over to him. First, of course, he has to find out where you work; and even then, in most states,

there are limits set relative to how much a creditor can garnishee for your wages.

If you have no job, and no visible assets, or you live in a state where your wages cannot be

garnisheed, your creditors actually have very few ways of ever collecting from you.

Many techniques used by creditors and collection agencies are illegal. A creditor or agency

can write letters to you; call you once a day in quest of a payment; and even knock on your

door to ask about a payment. but he is forbidden by law to harass you or invade your privacy,

or use deceptive means to get you to pay your bills. He cannot use foul and abusive language

over the telephone, tell anyone besides you the reason for his phone call, inconvenience you

or in any way threaten your job or your reputation in the neighborhood where you live.

Still, the best idea for reorganization and settlement of your debts when you find yourself in an

untenable position, is in-person visits and explanations of your situation with your creditors,

and a desire to explore other possible ways of mutual satisfaction without involving collection

agencies or bankruptcy. Give it a try - it's a lot easier than most people realize.