Fresh Start Debt Relief

Fresh Start Debt Relief

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Fresh Start Debt Relief

The Fresh Start Debt Relief Program offers financial relief to those who are buried in debt also for those who obtain Chapter 7 federal bankruptcy discharges.

FREE Consultation 

For Credit Card Debt Relief Call : 855-703-4226

For Tax Debt Relief Call: 631-301-2440

If you are a debtor in a Chapter 7 federal bankruptcy case and have received a Chapter 7 discharge (otherwise referred to as discharged), you might qualify for financial relief through the Fresh Start Program. To be more specific, the program targets borrowers who have been discharged from bankruptcy due to circumstances beyond their control. In other words, if you were out of work and unable to return to work because of a disability or illness, or if your business was brought to a close and you lost your job as a result of lay-offs, you might qualify for relief from debt under the Fresh Start plan. The eligibility requirements are that you must have become totally financially unindicted of any wrongdoing, and that you have met the other eligibility requirements.

How Does The Fresh Start Debt Relief Program Help

As previously mentioned, the goal of the Fresh Start Program is to assist with debt reduction and improve overall financial situation for the debtor. Under the terms of the program, once the recipient has qualified for chapter seven bankruptcy protection and has been discharged from this filing, he or she will be assigned an individual or group of individuals to act as primary and secondary paying agents. They will meet regularly with the debtor and develop a payment plan that will allow the debtor to pay off debt in small amounts, over a reasonable period of time. To make a successful payment plan, the creditor must agree to a payoff amount that is less than what would otherwise be required under the debtor’s loan agreement. If the creditor objects to the proposed payment plan, he or she must provide a letter detailing why such objections are being raised.

It is important to note that the primary and secondary paying agents are not creditors, and they do not represent the debtor. Rather, they are experts at negotiating with creditors for reduced interest rates, elimination of late fees, and other reductions in debt. They will coordinate all of the debtor’s needs, including finding eligible bankruptcy debtors, and work with them to establish a repayment plan that meets both their goal of lowering the debtor’s monthly payment obligations and their ability to pay such payments. Once they have negotiated a settlement, the creditors will agree to erase or reduce late fees and penalties on a monthly basis.

While the primary and secondary paying agents help the debtor with his or her payment plan, they will also do their part to protect the debtor’s credit rating. They will inform the court that the debtor has reached his or her limit on available chapter seven discharge funds, and request permission to suspend any collections that continue to accrue after the limit has been reached. The suspended collections will be removed from the debtor’s credit report, but will remain available for collections by other lenders. (The Camera Tickets provision will only apply to future chapter seven discharge proceedings.)

If no chapter seven funds are available, the fresh start payment plan will provide for a six-month period during which time the debtor will not have to make any payments. During this six-month period, the creditor will not look at any past due accounts. After the six-month period, the creditor will begin assessing all current and future potential debts. This is when the debtor’s credit report will show all current and future collection activity. If the debtor’s account contains more collection than is healthy, the collection activity will be reported to the credit bureau, which will make it possible for the agency to negotiate with the creditor and obtain the removal of the embarrassing collection items.

Some potential chapter seven discharge beneficiaries will receive a notice that informs them that the debtor has reached his or her limit on chapter seven payment plans. The debtor will then have up to six months in which to repay the balance. If the borrower fails to make payments during this six-month period, the creditor will then look-back period and apply the chapter seven discharge to the account. A debtor who buys a new vehicle with a financed price over one-fourth of the gross monthly income could be a chapter seven recipient based upon the value of the new car. A creditor will look-back period will also apply if the debtor receives any motor vehicle insurance premium payments.

For Credit Card Debt Relief Call : 855-703-4226

For Tax Debt Relief Call: 631-301-2440

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