Credit Law Firm
When your debts are too high, it’s common to turn to bankruptcy. While bankruptcy can be difficult to understand, it is also a great option for those who need it. What you may be wondering, however, is whether you can keep some of your credit cards or loans when you file for bankruptcy. The answer is that you normally have to give up all of your credit cards, due to the principle of fairness.
What Is the Principle of Fairness?
When you file bankruptcy, you do not get to choose which credit cards or loans that you discharge. Say that you have a credit card that is maxed out, but another card with less owed and a great interest rate. It makes sense that you want to keep the credit card that has an easier balance and an appealing interest rate. If you want to keep it, however, you are probably going to be out of luck.
Bankruptcy works on a principle of fairness. This means that all of the creditors need to be treated the same. it doesn’t matter how much you owe the creditor or what the interest rate is. You have to treat each one fairly.
What if You Don’t List the Creditor?
If you don’t list the creditor in your bankruptcy filings, then obviously that credit account will not be discharged. Now, this doesn’t necessarily mean that you get to keep it. Now, if you keep an account and need to file for bankruptcy in the future, understand that you probably will not be able to file on that account because you didn’t include it the last time.
In addition, you may lose the account anyway. Most credit card companies look through bankruptcy filings. These are public records, after all. If a company sees that you filed for bankruptcy, there is a high chance that they are going to take away your borrowing privileges right away. It doesn’t matter if you had a zero balance or always paid on time.
When it comes to bankruptcy, you want to include all of your credit cards and loans. Do not skip out because that could hurt you in the future. Even if you have credit cards that you want to keep, odds are you will not be able to after you file for bankruptcy. Instead, you will have to wait until you rebuild your credit to reapply for those accounts. If you’re not sure what to include in your bankruptcy filing, contact a bankruptcy lawyer, like a credit law firm in Las Vegas, NV, today! A consultation can help you figure out how to file.
Thank you to Ballstaedt Law Firm, for their input into credit and bankruptcy law.