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Interest and Penalties on Credit Card Debt after Filing a Chapter 7

Many folks who come into my office to file a Missouri chapter 7 bankruptcy ask, “When should I stop using my credit cards?” The answer is usually immediately. Credit card debt help is at the top of the list of needs for many folks who are ready to file bankruptcy with a Missouri or Illinois Bankruptcy attorney—and while a chapter 7 can be a credit card debt fix, the date of filing is usually considered the cut-off date to include this type of debt in the bankruptcy. Also, if you continue to use the credit card after you have determined you need a bankruptcy, it can be held to be fraud and would not be dischargeable.

So, what is chapter 7 bankruptcy and how will it help erase my credit card debt? Chapter 7 bankruptcy allows you to discharge (get rid of) and not pay back debts and bills and keep almost everything you own through state exemptions. Translation? Chapter 7 bankruptcy is your solution to credit card debt.

After you file, your creditors should stop sending you statements, harassing you over the phone, or charging you penalties and interest, as long as they relate to the debts discharged in the bankruptcy. If you start to incur debt again after your bankruptcy, those are considered new debts and penalties and interest do apply.

Does that mean that you can’t get a new credit card? No. In fact, you’ll find that smaller banks and credit unions have no problem giving you a credit card as long as you are willing to show that you are now more responsible by letting them hold your savings account as collateral. You can really start reestablishing your credit immediately. Are you wondering, “Should I file bankruptcy?” or “Can a Missouri or Illinois Chapter 7 bankruptcy really help me?” You can get the credit card debt facts you need to know, along with the answer to all of your questions about being in debt by reading my latest debt guide, “Get Out of Debt: Secrets Your Creditors Don’t Want You to Know.” Plus, you can request it for free! Just click here to get one step closer to a fresh start.

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