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Tarry Law Firm, L.L.C.
Serving Southeastern Missouri For 15 Years

Cape Girardeau Bankruptcy Blog

A checklist for dealing with overwhelming debt

Debt is stressful, especially when you are behind on payments. Worse yet, debt collectors may start sending relentless letters and calls. It can feel like giving up is the best answer. There are strategies to pay down overwhelming debt even when it appears impossible. Consider the following checklist for getting out of debt quicker.

Will you lose your house in chapter 7 bankruptcy?

Many people struggle for years with high debt and aggressive creditors instead of pursuing bankruptcy. They may worry that declaring bankruptcy will ruin their credit, take away their car and maybe even their house. Losing a house is a particularly strong pain point. Homes are central to our lives – they carry special memories, provide shelter and represent a family’s unique personality.

The prospect of losing a home may keep some individuals from declaring bankruptcy out of fear. The idea of bankruptcy may be intimidating, but in reality it is a tool that helps people get out of debt and start over. What actually happens to a person’s house when they file for chapter 7 bankruptcy?

But they can’t do that: What can—and can’t--debt collectors do?

Years ago, in the 1970s, our federal government codified the Fair Debt Collection Practices Act (FDCPA). The idea was to help consumers who had outstanding bills avoid harassing or bullying tactics from collection agencies trying to obtain payment.

Where before, virtually no rules were in place for debt collection shenanigans, now there would be parameters—and punishment—for collection agencies that went too far. Calling someone at work was taboo, calling early in the morning or late at night was verboten, threatening legal action they had no intention of taking was forbidden.

Fair debt collection: Creditor Harassment and Bankruptcy

For years consumers have enjoyed the protection of the Fair Debt Collection Practices Act. Codified in 1977, the Act outlines very specific rules debt collectors can use—and those they cannot—in order to collect money owed to the original creditor.

For example, say you owe Sears $700.00 for that emergency refrigerator purchase. But two months into payments, you lose your job. Before you know it, within months, you have completely defaulted. Sears calls you—but to no avail, because, as they say, you can’t get blood from a stone and you simply do not have the money to pay them.

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