Credit Cards and Bankruptcy

Unfortunately in this country, one of the leading causes of bankruptcy are credit cards. Credit card offers, department store cards and the like are readily available and many debtors are quickly overwhelmed at the amount of debt they have accumulated in a short amount of time. Thankfully, credit cards fall in the dis-chargeable category of debts in bankruptcy, and a bankruptcy can give the needed relief to hard-working individuals who struggle to stay financially afloat in the face of mounting credit card bills.  Credit card companies are very aggressive in collecting their debts, so if you find yourself behind, you should expect to be sued in State Court. If a creditor sues you and wins a judgment, they will begin to garnish your wages at a rate of 25% of your income.

Upon the filing of a petition for bankruptcy, the automatic stay kicks in to prevent any action to recover payment on a debt, including those by health care providers to recover medical bills. Such prohibited collection actions include anything from threatening or instituting lawsuits, to calling or sending letters in regard to an outstanding balance.

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