Advice about Civil Summons on Credit Card Debt
I was served a civil summons recently for non payment of a credit card, if I file for bankruptcy, will it be revoked?
I was served a Civil Summons from the District court for a credit card that we quit paying on due to our finances. This is not the only credit card we had to quit paying on. My husband was laid off and I just had a baby. By the time we got on our feet our minimum payments were ridiculous. My question is If we filed bankruptcy, would the summons be revoked?
- Review all your options for resolving debt, before you file for bankruptcy.
- Speak with an experienced bankruptcy attorney, to see if you qualify for bankruptcy.
- Make sure to understand if your bankruptcy discharges your debt obligations or if you must repay them.
If you file for bankruptcy, then all ongoing cases against you will be put on hold. It does not mean that the summons will be revoked; rather it will be put on hold till the bankruptcy court determines if you qualify for chapter 7 or chapter 13. If you qualify for chapter 7, then in all likelihood, this debt will be dismissed along with the other qualifying debts. If you qualify for a chapter 13, even then, the court will decide on the payment terms for that debt. I will discuss more regarding bankruptcy in just a moment.
Bills.com offers advice on how to file for bankruptcy if you chose to take that route.
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Before you decide to file for bankruptcy, I encourage to speak to one of Bills.com's approved debt help providers, to see what your available options are.
Types of Bankruptcy
There are two basic types of consumer bankruptcy: Chapter 7 and Chapter 13. In a Chapter 7 bankruptcy, also called a liquidation bankruptcy, a bankruptcy trustee will examine your assets, and if you have any assets which are not exempt, sell those non-exempt assets to repay your creditors. Once your non-exempt assets have been sold to pay your creditors, all remaining unsecured debts will be discharged by the bankruptcy court.
Many people who file for Chapter 7 protection are able to keep all of their property because they have no non-exempt property. Each state has its own schedule of exempt assets, so you should consult with a qualified bankruptcy attorney in your state to find out if Chapter 7 is a workable solution for your situation. An attorney will also be able to tell you if you qualify to file Chapter 7 under the new guidelines enacted by Congress in 2005.
You mention in your question that you may lose your home in bankruptcy, so it sounds like Chapter 7 was the bankruptcy chapter you discussed with your attorney. There is an alternative, though, in Chapter 13 bankruptcy.
A Chapter 13 bankruptcy, also called a "wage-earner’s bankruptcy", allows you to propose a plan to repay creditors over time, usually five years. Your monthly payment amount will be based on your monthly disposable income as defined by the bankruptcy code.
After you have made payments to your creditors for five years, any remaining unsecured debts will be discharged. Chapter 13 is commonly used by debtors whose assets exceed the exemptions offered by state law. It is also used by many consumer debtors who do not qualify for Chapter 7 relief under the means test, which went into effect in 2005 with the Bankruptcy Reform Act.
Consult with an attorney to find out if bankruptcy will benefit your financial situation. Read more about bankruptcy at the Bills.com Bankruptcy Information page.
I hope you will be able to resolve your financial problems without the need to file bankruptcy.
I hope this information helps you Find. Learn & Save.