Future.

Many people in Mississippi feel like they are drowning under the weight of credit card bills, medical expenses and other forms of debt. When the pressure of debt becomes too great to bear, people can look for options to find relief and forge a path to a new financial future. Personal bankruptcy, including Chapter 13 bankruptcy, is one such option that can allow a person to keep their property and pay back their creditors over a set period with a court-approved repayment plan.

In general, if the monthly income of the person filing for bankruptcy exceeds the state’s median income, he or she must pay back the debt over a five-year period. On the other hand, if his or her income is equal to or less than the state’s median income, the debt can be addressed with a three-year repayment plan. At the end of the repayment period, debtors can find significant relief or eradication of the bills that have overwhelmed their lives.

In order to file for Chapter 13 bankruptcy, people in debt must follow the proper legal procedure, including providing proof of income, a list of creditors, an inventory of property and monthly living expenses. Filers must produce their most recent tax returns in addition to proof of tax filings as well as submitting a repayment plan. Debtors must adhere to the plan and continue to make child support payments, repayments to creditors and tax filings. The repayment plan must include full payments for certain types of debts and lesser payments for other types of unsecured debts.

Chapter 13 bankruptcy may be an important road out of debt for many people, especially those with too much income to qualify for Chapter 7 bankruptcy. Throughout the process, a bankruptcy lawyer may represent a debtor to advocate for a fair repayment plan that puts the client on a path to success.

When you are experiencing financial difficulties, you would do almost anything to keep from losing your home. The thought of foreclosure is enough to cause chronic stress and fear in any Mississippi resident. Fortunately, you have options that may allow you to keep your home and make your debt more manageable, such as Chapter 13 bankruptcy. You may also have been advised to apply for a loan modification, but you might hesitate before you learn more about this option.

U.S. News & World Report explains that there are positive and negative aspects to getting a mortgage modification. The immediate benefit to a modification is that the lender lowers your payments, which can help your mortgage payments fit nicely into your monthly expenses. However, the numerous downsides to a loan modification can include the following:

• A loan modification can significantly raise your interest rate and add years to the length of your repayment schedule.
• The lender may mislead you on the terms of your loan and other options that could better fit your situation.
• The lender may tell you that it will forgive a portion of your loan with the modification, only to add the “forgiven” amount to the end of the loan without your knowledge.
• A loan modification can involve lots of paperwork, hassle and time.
• Scammers posing as legitimate lenders often target people desperate for help, and they may ask for up-front processing fees, which are illegal.

When you file for Chapter 13 or you are having difficulty keeping up with your mortgage payments, companies may contact you offering a loan modification to “solve your problems.” A legitimate modification may help you temporarily while you rebuild your credit if you plan on refinancing later to get better interest rates. It helps to understand your other options if you are unwilling to accept the downsides to a loan modification.

Like many Mississippi residents, you have some debt. It can be challenging enough taking care of your usual bills every month. The last thing you need is another debt added to the pile. However, one day you get a collection notice in the mail for a debt you don’t recognize. You are sure you didn’t make this purchase, so why are you receiving a bill for it? Even worse, why are you being taken to collections for it?

This is, unfortunately, not an uncommon scenario. Countless people receive bills for unfamiliar purchases, which can spark uncertainty and panic when they start receiving collection notices or harassing phone calls. Can you get this debt taken off your record? Will it affect your credit score? How can you get the harassment to stop?

The U.S. Federal Trade Commission explains that an unfamiliar debt may be a case of mistaken identity, or you could be the unwitting target of a scammer who is hoping you won’t question the charges and will pay up. Regardless of the reason, you can take the following steps to protect your credit and dispute a debt you don’t believe is yours:

• Send the collector a written letter explaining why you believe the debt is not yours and state that you want the calls and letters to stop.
• If you’re getting phone calls, ask for the caller’s name, company, address and contact information. Don’t discuss the debt over the phone until the company sends you details in writing.
• Don’t volunteer any personal information or correct wrong information with the correct details, even if you don’t believe you owe the debt.
• Check your credit report and dispute any discrepancies in writing.

You might feel tempted to just throw away collection notices for a debt you’re sure doesn’t belong to you. However, if you fail to address the issue, the harassment is unlikely to stop, and even a false debt may impact your credit score.