Ravosa Law Offices PC
Overcome Debt with Dignity
Bankruptcy Myths
DO NOTHING
MISCONCEPTION
Even if your debt is charged off, it does not mean you do not owe the debt. Charge off is an accounting procedure used by your creditor and it does not cancel the debt, even when a 1099 is issued, the Creditor can sell your debt to a debt buyer who will have the legal right to collect your debt.
BANKRUPTCY
Bankruptcy can be the least expensive and quickest method to eliminate most if not all of your debt*, With a Chapter 7 case, your case can be over in as little as 3 months Although called a liquidation chapter, most clients keep all their real and personal property by hiring a competent Bankruptcy attorney who applies the most effective exemptions to protect the Debtor’s property. Chapter 7 does not require payments to the creditors by the Debtor if all property is exempt.
Chapter 13 is a payment plan, Chapter 13 cases can be over in as little as 3 years for those debtors who do not have high income, for those with higher income the plan will typically be 5 years. Our clients generally pay 1%-10% of their debts* the remaining balance is wiped out after the plan is completed.
*There are some debts that are not dischargeable in Bankruptcy, the most common are student loans, taxes, child support, alimony and divorce agreement.
MISCONCEPTION
Clients biggest fear is their credit will be ruined for 10 years. The credit hit takes effect upon filing, immediately after filing, steps can be taken to increase your credit score. Many clients who put the time and make efforts can achieve a higher score in a year than when they filed Bankruptcy in a year or less as they will not be settled with high balances or credit usage ratios that exceed 50%. This is one of the reasons they call Bankruptcy a Fresh Start. It is possible to obtain new car loans and even a house after Bankruptcy with time and effort.
DEBT SETTLEMENT
Creditors are contacted, the account ages and negotiations begin. The goal is to negotiate with the creditors to accept less than what is owed. Typically, the general range of success for debt settlement can vary in our office, settlements can be as low as 25% of the debt owed to 60%, but most settlements are in the range of 40%-50%. To obtain excellent results with debt settlement your account needs to age, typically it takes six months to one year of nonpayment to obtain the best results. With Debt Settlement most creditors expect a lump sum payment.
NOTATION
Unlike Bankruptcy which has no tax consequences, with Debt Settlement any savings is considered income and can in certain circumstances have tax consequences.
WARNING
Avoid any company out of your state. Many of our clients have used companies out of state to pay thousands of dollars and obtain little to no results and are unable to obtain a refund.
DEBT CONSOLIDATION
Instead of paying multiple bills which have various interest rates, Debt Consolidation is typically done by taking out one loan to pay the all your outstanding bills.
WHAT TO AVOID
Taking out loans against your Equity in your home or a 401k loan, this can cause significant risk, a lender for a Home Equity Loan can foreclose if you fall behind in your payments. A 401k loan can prevent you from saving more for your retirement, the time when you need the money the most.
DEBT MANAGEMENT
Sometimes labeled as debt consolidation, this is done through companies who make promises to lower interest rates or balances.
BEWARE
Fees can be hundreds of dollars per months. This is the most expensive way to resolve your debt. Your creditors have to agree with the plan, any creditors who do not agree can still move forward with collection actions such as lawsuit, judgment and garnishment of wages.
URGENT WARNING
Use in state services, do not use any company, organization or attorney out of State. Most out of state vendors will gladly take your money and then you have no recourse. If you choose any Debt Solution use a company, organization or Attorney in the State in which you reside.
Ravosa Law Offices PC
Natick
One South Avenue
Natick, MA 01760
Worcester
40 Jackson Street Suite 1020
Worcester, MA 01608
Boston
Offices At The Mariner
300 Commercial Street, Ste. 2
Boston, MA 02109
Springfield
55 State Street,
Suite 317,
Springfield, MA , 01103
Cape Cod
The Foster Building
76 West Main Street Suite 104
Hyannis, MA 02601
Ravosa Law Offices PC
Office Hours: M-F 9-5 Before/After Hours Call: (508) 816-6657
Boston
Offices at the Mariner
300 Commercial Street, Ste. 2
Boston, MA 02109
https://goo.gl/maps/4qynEmkBnDM13YGw7
Website: bostonlawcenter.com
Email: rravosa@ravosalaw.com
Call: (617) 720-1101
Fax: (617) 720-1104
