Yes, bankruptcy will clear debt from your credit cards. It can be done in both chapters 7 and 13, but it's best if you do a no-asset chapter 7. The idea is to erase all of the balances at once and walk away. You may wind up having to file a chapter 13 if it's determined that you have enough money left over to pay.
Ensuring That All Debts Are Cleared
Part of the bankruptcy petition process is filling out schedules. Schedule F is the one that is relevant to credit cards. This is where all of your accounts and balances are listed, and from where the court will get notifying information. The importance of having all of your accounts entered on this schedule cannot be understated. Missing a creditor on your schedule could result in that account not being discharged.
The first thing to do is to obtain a copy of your credit report from all three agencies. Any and all accounts that you have opened will be on them. If you're not certain that all are there, collect a month's worth of mail before filing. You can also check with the debt collectors for which account they're collecting for. Cover every base that can be thought of. Once you're sure you have all accounts you've opened, enter them onto the schedule F. Doing this will ensure that all of your credit cards debt will be eliminated at discharge.
Court Notification of Creditors
Now that your creditors have been listed and filed, the court will start sending out notices to them of your case. They are ordered to stop all collection activities for monies owed. Any judgments will be vacated and most liens will be lifted. All of this is due to the automatic stay that is granted upon filing. There may be the occasional contact for the first week or two after filing. The creditor is not breaking any law as long as it's not harassing. It's acknowledged that it will take some time for the information to work its way through the various systems. You can also inform the creditors of your bankruptcy and provide them with the file number for them to investigate. They can look up the information through a system known as PACER to verify.
Consulting a Lawyer for Advice
Being hounded by creditors is stressful. If you're carrying a lot of credit cards debt, you should consider filing for bankruptcy. The best thing to do is to talk to an experienced bankruptcy attorney about your options on how to eliminate credit card debt with bankruptcy and how to move forward. A successful discharge means no more debt and a brighter future.
