Bankruptcy Chapter 7 and a Little Bit About Your Property Taxes

Aug. 3, 2010 - PRLog -- A chapter 7 is the easy way to discharge all unsecured debts. Examples of unsecured debts are credit cards, medical bills, broken apartment leases, cars that have been reposed, houses that have been foreclosed on, old bank accounts that were closed by the bank because of over draft charges, some bad business dealings, some IRS debts and other such things. Your case is filed and then in about four months you receive a discharge. the bankruptcy is then on your credit for the next ten years. What is important is what you do now. If you do not have income no you’re not going to rebuild your credit, having a checking and saving account is important. Taking on new credit whether it be through a credit card or some form of secured loan like a jewelry shop or a furniture store. Very important make the payments on time every time. A car is a good way to help kick start your credit but buy something affordable or have some cash to put down with it depending on timing the interest rate is what is so important. a ten thousand dollar car over five years at a 6 percent interest rate will run you about 250 a month for five years. that same car at 17 percent will run you about 400 not a good deal. So you need to do the things to help rebuild a quick as you can, so when the need is there you can afford to buy what it is that your needing.

Everybody who owns a home is responsible for paying property taxes. Property taxing authorities have an automatic lien on your house and must get paid. When a Debtor filed for bankruptcy, if they owe property taxes they will have to be paid through the bankruptcy.

Many people have the property taxes escrowed with their mortgage, and they will be able to list the property taxes as paid direct since the mortgage company will pay them, but if you are past due on taxes they will need to be listed to be paid in the Chapter 13 plan.

This is an especially difficult time for Debtors when it comes to property taxes. Their ’06 taxes have just come due and are barely past due, but the property tax authorities want to be listed in the bankruptcy to make sure they get paid. The taxing authorities are also giving Debtors the option of including their ’07 property taxes in their bankruptcy or listing them as pay direct. This can be beneficial for Debtors if they haven’t started putting money away for their taxes.

Many Debtors rely on their tax refund to pay their property taxes. The only problem with that is if the refund if over $2000 it goes to the Trustee and can take an additional 2 months to receive and the Debtors will usually only receive $2000 of the refund. If a Debtor is relying on the tax refund to pay the property taxes, it may be late and cause an increase in taxes to be paid due to late charges and it might not be enough to cover the total.

The best thing to do if your taxes aren’t escrowed is to set up a savings account and deposit money in it every month or every pay check to make sure at the end of the year there is enough money to cover the property taxes.

For more information visit http://www.bankrupcy-alternative.com/bankruptcy-and-unemp... or call us directly. Here is another bankruptcy article http://www.prlog.org/10835102-why-bankruptcy-and-bit-abou... and here is another http://www.prlog.org/10832479-bankruptcy-irs-liens-agains... for your reading enjoyment.

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