Are you considering bankruptcy but wondering how it will affect your credit card debt?

Depending on the type of bankruptcy that you file for, it can affect your debt in different ways. In most cases, your credit card debt will be classified as unsecured. This means it is based only on an obligation to pay, as opposed to secured debts which are based on collateral, like a mortgage or a financed car.

When you file for Chapter 7 bankruptcy, your credit card debts are usually discharged. In this type of bankruptcy your non-exempt assets are liquidated to pay off your debts. Yet since changes have recently occurred in bankruptcy law, it is harder to file for Chapter 7 bankruptcy. Chapter 13 bankruptcy is different in that it focuses on paying down your debts over a period of time instead of liquidating your assets to do so. Some debts will be discharged, like student loans and back taxes, while you will be forced to pay down others.

Need help with bankruptcy?  Now is the time tocontact our firm and consult with a Houston bankruptcy lawyer.