Bankruptcy/Getting Out of Debt David Bachelder, Dravin Stockwell, Ryan Webster, Amanda Misenhelder

Signs of debt problems/overspending Using your savings account for daily expenses. Getting cash advances from credit cards to pay other creditors and/or daily expenses. Arguing with your family members due to money problems. Making the minimum payments on your credit cards. Maxed out credit cards

Types Of Bankruptcy Chapter 7 Chapter 9 Chapter 11 Chapter 13 This is the most common type. (Liquidation) This type covers most loans/debts. You give up assets such as jewelry, cars, property. You don't need a lawyer. You won’t have access for credit for a long time (7-10 years). Chapter 9 For corporations and cities Lawyer is optional but most commonly used Chapter 11 is a reorganization for corporations, or individuals with debts over $336,900 in unsecured debts (no collateral) and secured debts (with collateral) over $1,010,650 (Lawnetwork) Chapter 13 is a reorganization for individuals (people). It is for people who have under $336,900 in unsecured debts and secured debts under $1,010,650 (Lawnnetowrk)

Debt Collection Debt Collectors Debt Collectors Can and Cannot A person who collects someone's debt Example- Lawer, Collection Agencies, etc Debt Collectors Can and Cannot Can Send people after you till they receive their money But can’t do it at an inconvenient time for example 3am But can’t harass you But No stalking Can continue to add interest But can’t add excess interest charge as in raise the rate Take money from connected accounts Send you a default notice They can pass the dect along to a debt collection agency

How Life Events can Impact Your Credit and Finances Marriage/ Divorce A divorce does not affect you directly hurt your credit. Financial strain is what leads to poor credit by missing bill due dates. Death of Spouse Debt of deceased that the living individual has to pay for. Bills for the deceased that still need paid for. Losing your job Earn less than you did previously. No be able to make payments on time.

Ways To Avoid Bankruptcy Settle/Negotiate your debts. Sell property. Borrow money from family and friends. Restructure your spending. Ask creditors to help you avoid it.

Strategies to Help You Pay Off Debt Stop creating new debt. Cut up your credit cards. Freeze them… literally in water. Make a list of debt amounts and interest rates. Calculate the amount of debt you owe with interest in a certain period. Don’t give in to temptation. Ask yourself these questions: Is it a want or need? Can it wait until I get paid? Will it pay for itself in a few years?

Open Lines of Credit One Credit Card So you can build your credit score Keep 1-3% Credit limit to steadily increase credit Can Keep More to positively affect your credit score One Issue Overuse of cards Abuse of cards Cards could be stolen Make sure that you only have and apply for credit cards that you really need Example- Total Credit limit 5000 and you use 500 a month makes your percentage used 10%, or total Credit limit 2000 and you use 500 a month makes your percentage used 25% In the first example it shows that you’re responsible with money as you only used 10% but the second example makes it seem like you’re less responsible as you use 25%

Financial/credit counseling What is it ? Financial counselors help people learn to manage their own financial resources. Involves financial problem solving. Where can you get it? Financial Institutions Social Service Organizations. How much does it cost? It’s free When do u need it? There is no specific amount of debt

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