Christian Credit Card Bankruptcy
Christian credit card bankruptcy is just one more way that an individual can get himself into deep financial trouble and eventually sink into the black hole of bankruptcy. Much news can be heard from television and newspapers about businesses that have been run into the ground by greedy corporate executives, but who would ever think that the little plastic charge card with all the pretty colors and distinctive pictures could be the lead weight around so many consumers' feet? Trips to that frou-frou coffee place each morning, movie tickets, gasoline, some groceries here and there, those to die for shoes and purse, those new racing wheels and tires, the first plasma TV on the block, medical co-pays, fishing licenses and all the little things that go into the American consumer's day and week slowly bring the consumer to the brink. Simply swipe the plastic or show the plastic and before one blinks, ten thousand dollars can be on a charge card and the holder sits and wonders where did it all go? The scenario of credit card bankruptcy is repeated over and over again.
Recent estimates by some financial gurus say that seven out of ten Americans live pay check to paycheck. This would mean that seventy percent of Americans do not have any tangible savings and are probably living with a great deal of debt. While much of that debt could be attributed to car payments, educational loans, mortgages and other big ticket items, many other of life's luxuries have to be supported by using charge cards. It's not rocket science to figure out that making minimum payments on charge cards means at least thirty years of enslavement to those banks. So instead of debt going away, the debt, like heavy snow keeps falling and there soon becomes no where to put the stuff. And because of very tough new bankruptcy laws in the past few years, credit card bankruptcy cannot just be swept under the table as it might have been previously.
There are two types of credit card bankruptcy, chapter seven and chapter thirteen. Chapter seven is the complete forgiveness of all debts except for taxes and federal student loans. This legal action is taken when the debtor feels that there is absolutely no way out of his situation. In this particular legal proceeding, the moment that a person files for chapter seven relief, all attempts at collection are to end. The court appoints a trustee to oversee the debtor's estate and only a relatively few items are really exempt from being sold to appease creditors. The person filing for chapter seven credit card bankruptcy is allowed under law to state which items are to be exempt, but all items being claimed must be on the state's approved list. The debtor's state of residence has already declared those items that are under bankruptcy exemption.
The second type of credit card bankruptcy or any consumer bankruptcy for that matter is chapter thirteen. This is a legal motion to have the bill collectors stop calling, but it also represents a desire on behalf of the cardholder to payback all monies owed, but only over an extended period of time. In many cases, those consumers who are close to declaring bankruptcy because of high charge card debt first seek help from debt counseling companies. These companies negotiate with credit card companies to have interest rates lowered dramatically so that the card holders can begin to pare down the high amount of debt they owe. The debt counseling company does receive a fee from this negotiation process which is often included in the monthly payment made to the company for loan payback. Credit experts warn consumers, however, that even pursuing and using the help of a debt counseling company will be an adverse mark on a person's FICO report and will affect their score. Debt counseling, which can be cheaper than hiring an attorney for chapter thirteen legal proceedings may be the right alternative for many people mired deeply in charge card debt.
As stated earlier, credit card bankruptcy remains on a person's FICO report for ten long years. A chapter seven filing costs a person much of his assets, although very personal property is safe from liquidation. In some states, only a few thousand dollars of home equity is safe from the court system while in other states a person's house is totally exempt. Chapter thirteen legal actions save a person's assets and may be the best way to face large charge card debt. In either case, new bankruptcy laws passed by Congress make it more difficult for certain people to even consider the action. The first toughened portion of the bankruptcy says that a person filing chapter seven must have a household income the same or lower than the median income for that particular state. The second portion of the toughened law says that if a person or household's income is above the median income of the state, chapter thirteen is the only option.
The cost of an attorney for a credit card bankruptcy chapter seven filing is estimated at about fifteen hundred dollars. The cost for barrister fees in a chapter thirteen filing is about twenty-five hundred dollars because there is more paperwork for the lawyer to go through. The emotional cost for almost anyone going through legal proceedings such as these can be quite devastating, particularly in the long run. Yet Jesus reminds us all that the cost of ignoring our soul's salvation can be eternal. "For what shall it profit a man if he shall gain the whole world and lose his own soul or what shall a man give in exchange for his soul?" (Mark 8:36-37)
Christian Credit Cards After BankruptcyCredit cards after bankruptcy are not impossible to acquire. Having a bankruptcy on past financial history doesn't restrict one from being approved for credit cards. Some lenders require a security deposit from applicants who apply for credit cards after bankruptcy by having the consumer deposit money into a bank account that matches the available balance on the card. This provides security to the lender in case of default.
Oftentimes consumers find themselves in a debt situation due to overuse of charge accounts. Credit card debt is the number one debt problem faced by most people. It might not be wise to apply for new credit until counseling has been sought and the consumer understands the danger. Financial counseling will help in learning to budget money and live within one's income. Make a list of all debts and income to see a clear picture of monthly obligations. Make a detailed monthly budget and stick to it as close as possible.
Consumers will do best to start out with a low credit limit on charge accounts. Acquiring charge cards with a low limit is a good way to learn how to handle money. Use charge cards only for emergencies or be committed to pay off the balance in full each month to avoid high interest charges. Credit cards after bankruptcy can be used to secure things like rental cars, hotel rooms, and make online purchases. Use wisdom when using charge accounts. It is easy to get back into debt even after filing bankruptcy. "There hath no temptation taken you but such as is common to man: but God is faithful, who will not suffer you to be tempted above that ye are able; but will with the temptation also make a way to escape, that ye may be able to bear it" (1 Corinthians 10:13).
Interest rates for charge accounts after bankruptcy are usually very high. Having a bankruptcy on financial history will lower scores and lenders will see the consumer as a high risk. Some lenders offer credit cards after bankruptcy through unsecured charge accounts. Lenders usually offer low start up credit limits and high interest rates to consumers with questionable financial history. There may also be annual fees and monthly maintenance fees associated with this type of account. If the consumer decides to apply for this type of charge account and is approved it is wise to keep limits low and pay off the entire balance each month to avoid having to pay high interest and fees.
Credit cards for bad credit will help the consumer re-establish his or her financial rating with the ability to pay off other debts. Some financial institutions who offer these promotions will promise monthly reporting to the major bureaus. Lines and limits on these accounts usually start out low and some banks offer low fixed interest rates to interest the consumer. Anyone interested in an account of this nature can apply online by providing basic information. This information may include driver's license number, social security number, date of birth, and address. Many financial institutions offer accounts and may offer periodic credit line increases if payments are made timely. Often, banks offer low annual fees and competitive interest rates.
Some offers online for accounts of this nature may provide the opportunity for prepaid accounts. This is different from a traditional account because no check of the individual's financial record is required. Credit cards for bad credit that advertise prepaid accounts allow the consumer to load their own funds to be used when making purchases. Funds may be downloaded through payroll direct deposit, e-check, and through wire transactions. Prepaid accounts will help to re-establish financial standing for the consumer who has had financial problems in the past. There is a one time application fee and a monthly fee on prepaid credit cards for bad credit, making them even more appealing to the consumer.
Taking an account of this nature when the Christian has poor financial ratings may provide a great chance to improve or increase ratings. Making payments on time and keeping balances below the limit will help improve a low score. Banks advertise that obtaining a secured account online is guaranteed with review of a person's financial history needed. Banks verify age, social security number, and residence on an individual's application. Financial history is not considered for a secured account and promotes building of credit by maintaining a good payment history. In order to access funds, the consumer must make deposits to cover all usage. This is deposited into a collateral account with the bank who issued the credit cards for bad credit. A processing fee is usually charged for a secured account. This type of account usually includes a guarantee of approval if personal information is verifiable. "That ye might walk worthy of the Lord unto all pleasing, being fruitful in every good work, and increasing in the knowledge of God." (Colossians 1:10)