Credit cards are not always treated as unsecured debt in bankruptcy. An unsecured debt is not backed by collateral, unlike loans for a vehicle or home. Secured credit cards are most often used for purchases in stores, such as Best Buy. Furniture shops and other department stores may also offer secured cards, using any purchases as the collateral. In the event of non-payment and default, these stores that offer secured cards could repossess the property. As these secured cards are backed by collateral, they are therefore not treated like a typical unsecured credit card in bankruptcy. Depending on whether you file for Chapter 7 or Chapter 13 bankruptcy, secured debts can be treated differently. This is an important fact to remember if you want to keep the property. Can You Keep Property Bought with Store Credit Cards? Chapter 7 bankruptcy: If you file for Chapter 7 bankruptcy, you may keep…
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The financial website NerdWallet recently published an interesting article on how predatory credit card lenders are tricking borrowers into a cycle of debt. If you have experienced a dip in your credit score, chances are, you have received letters in the mail from these lenders. These letters may promise one-time offers or other urgent messages to get you to sign up. In reality, credit cards sent by mail are generally predatory and a bad choice for consumers. How Predatory Credit Card Lenders Trap Borrowers in Debt NerdWallet suggests 48 million Americans with credit scores of 600 or below (considered subprime) are targeted by these lenders in the following ways. Higher interest rates: Subprime borrowers are seen as risky to lenders, and this risk is compensated by using high interest rates to recover losses in case of default. Borrowers end up paying more each year in interest. Targeting people without a…
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*Credit card payments will not be accepted for bankruptcy cases, unless pre-approved by The Sader Law Firm. If you have a question about a credit card payment, please call our Office Manager at (816) 561 1818.
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