Legal Ways To Get The Bill Collectors Off Your Back

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Legal Ways To Get The Bill Collectors Off Your Back


Sometimes, the formal and legal declaration of personal bankruptcy is
the best way to go when you're "snowed under" with bills, and you
just can't see your way clear to survive.

Actually, bankruptcy allows you to make a fresh start. Generally, it
takes only a small amount of money, a careful evaluation of your assets and
your liabilities. In many cases, a lawyer is not necessary.

If you have very few assets, mountains of debt, and not enough income
to meet your obligations, then your best bet is almost always the filing of
straight bankruptcy. What you'll need is the proper forms "S3010
Bankruptcy forms, for an Individual Not Engaged In Business." These can
be purchased from any full-line office supply store, especially in an area
serving attorneys' offices.

You'll need to know which district you love in for Federal Court
purposes - so look in the white pages of your telephone book under U.S.
Government - Courts - and take down the address of the nearest U.S. District
Court. Check it out to be sure that your residence is in this court's

You then fill out the forms you purchased, listing all of your
creditors - those with priority being listed first - meaning those who have
extended credit to you against some sort of security or collateral, followed
by those who have extended credit to you on just your signature or
reputation. You must be sure to list all of your creditors because any that
you fail to list, will be able to sue you and collect even after the
bankruptcy has been adjudicated. At the same time, be sure to include the
names of anyone and everyone you may have co-signed a note or a loan for, as
well as anyone who may have co-signed for you.

The laws governing personal bankruptcy vary in all states, but
generally, a bankruptcy judgement will not take away the house you live in,
basic home furnishings, a car that's necessary towards your gainful
employment, nor the tools of your trade. Check these things out to be sure
against the list of items regarded as the necessities of life by your state.

When you've got all the forms filled out, and notarised, you take them
to the Clerk of the U.S. District Court in your jurisdiction. You pay the
clerk $50, and from there, you're home free. The clerk notifies your
creditors, and reminds them that being as you've filed bankruptcy papers,
they cannot bother you about your debts anymore.

However, they are invited to your hearing. Usually they don't show up,
because by that time, you have very few, if any, non exempt assets left that
they are really interested in.

But, whatever assets you do have that are non exempt, will be sold by
the Court to appease your creditors. Any money realised from these sales is
then added to the total amount of money you may have turned over to the court
at the time of your filing, and divided equally amongst your creditors
according to priorities.

After all of this has taken place, and usually about 3 months after
you've been adjudged bankrupt, you can start all over again to incur debt,
pay bills and establish a new credit rating. However , you should be
especially careful about talking with your old creditors because they may
attempt to maneuver you into signing a "reaffirmation" of your old
debt. The thing to do is to be sure that you carefully read anything you
affix your signature to, and don't agree to pay on any debt that has already
been discharged through your bankruptcy!

In some bankruptcy filings, it is definitely advantageous to hire an
attorney to represent you. This is especially try for people who have assets
such as real estate they want to protect, and/or people who has been
operating home-based businesses or been accused of fraud. Remember this, if
you decide to process your bankruptcy without a lawyer, then it is your
responsibility to fill out all the necessary forms accurately and completely,
and every bit as precisely as if you had paid an attorney to do it for you.
Leaving out a creditor's name or address or forgetting a loan that you
co-signed for, will surely bring on litigation against you even after your
bankruptcy has been adjudicated. Be sure you understand all the papers, ask
the Court Clerk for advice, and if you run into problems, then take it in to
an attorney.

Besides the regular bankruptcy laws, there's also a little-known and
little-used method of getting reorganised with your debt, particularly when
you've got a steady job and just need more time to straighten your
indebtedness out. This is the wage-earner's provisions of Chapter XIII of the
Federal Bankruptcy laws.

Basically, these provisions allow you to make new arrangements with
your creditors and pay off all your debts over a new 3-year period of time.
When you filed for indebtedness relief under the provisions of this law,
nothing is recorded permanently on your credit record. You get to keep all
your assets, but you must pay off all your debts. But, so long as the Court
grants you relief under these provisions, and you pay your creditors
according to the repayment schedule agreed upon by the Court, your creditors
cannot bother you. Even if they have begun a suit against you, once the Court
has given you relief, they cannot touch you! Once you've filed under these
provisions, your creditors are immediately restricted from even contacting
you, and get only what the referee or trustee doles out to them.

Often-times, if a creditor threatens to sue you, the most effective
thing you can do is to tell him frankly that if he sues you, you'll have no
other alternative except to file bankruptcy papers. In many instances, this
will cause him to take a second look and to do whatever he can to assist you
in paying him the money you owe, but over a longer period of time, and at
smaller monthly payments. The absolute bottom line is that your creditors
know only too well that if you do file for bankruptcy, their chances of
receiving even half of what you owe is practically nil. Thus, it's in their
best interest to do everything they can to help you to continue making
payments on the amount you owe, regardless of how small those payments may

When a creditor does sue you, and gets a judgement against you, he can
then get a court order directing the sheriff to seize your personal property
and sell it, with all moneys realised going to the creditor to satisfy your
debt. When they see this about to happen, many people connive to make
themselves "judgement proof." In other words, they hide their
assets or move them out-of-state before the sheriff or Marshall arrives. This
is illegal, but is done as often as not.

Many creditors will attempt to "garnishee" your wages. This
is done by getting a court order directing your employer to set aside part of
your wages or salary every pay period and turn it over to him. First, of
course, he has to find out where you work; and even then, in most states,
there are limits set relative to how much a creditor can garnishee for your

If you have no job, and no visible assets, or you live in a state where
your wages cannot be garnisheed, your creditors actually have very few ways
of ever collecting from you.

Many techniques used by creditors and collection agencies are illegal.
A creditor or agency can write letters to you; call you once a day in quest
of a payment; and even knock on your door to ask about a payment. but he is
forbidden by law to harass you or invade your privacy, or use deceptive means
to get you to pay your bills. He cannot use foul and abusive language over
the telephone, tell anyone besides you the reason for his phone call,
inconvenience you or in any way threaten your job or your reputation in the
neighbourhood where you live.

Still, the best idea for reorganisation and settlement of your debts
when you find yourself in an untenable position, is in-person visits and
explanations of your situation with your creditors, and a desire to explore
other possible ways of mutual satisfaction without involving collection
agencies or bankruptcy. Give it a try - it's a lot easier than most people

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