walt disney drawing mickey mouse on a chalkboard


By:Mike Cibik


Bankruptcy does not discriminate. It doesn’t care if where you come from, what your occupation is or how much money you have in the bank. Most people assume bankruptcy is associated with people who are careless with their spending. However, bankruptcy happens for a myriad of reasons. For celebrities, there are many reasons why they file for bankruptcy, including debt, canceled contracts, costly divorces, delinquent on taxes and failed businesses.


Declaring Bankruptcy Due to Debt

Just because you’re famous does not give you a free pass to spend without care – and not pay your taxes. The celebrities below declared bankruptcy for a number of reasons.

  1. 50 Cent – The rapper filed for bankruptcy in 2015, days after being ordered to settle a lawsuit for 5 million dollars.
  2. Gary Busey – According to Reuters, the actor filed for bankruptcy in 2012 due to debts between $500,000 to $1 million.
  3. Toni Braxton – Sometimes it seems you can’t catch a break. The singer filed for bankruptcy twice. The first time in 1998 due to low royalties and the second time in 2010 for canceling her Vegas show due to illness.
  4. Burt Reynolds – We all know divorce can be ugly. In Reynolds case, his divorce from Loni Anderson in 1993 put him $10 million into debt. He filed for bankruptcy in 1996.
  5. MC Hammer – The “Can’t Touch This” singer spent an enormous amount of money on his entourage, not to mention he was delinquent on his taxes. Hammer filed for bankruptcy in 1996.
  6. Drake Bell – The Nickelodeon star spent more than he earned – $18,771 per month. As a result, created a $581,000 debt; the only solution was bankruptcy.

Filing Due to A Failed Business

Declaring bankruptcy is a common business practice, especially if you want to keep your business in operation. Despite filing for bankruptcy, these business owners didn’t give up and went on to have better financial futures.

  1. Walt Disney – The creator of Mickey Mouse filed for bankruptcy in 1921 because his company Laugh-O-Gram Studio failed. It’s a good thing Disney didn’t give up his animation dreams.
  2. Stan Lee – The comic book legend filed for bankruptcy in 2000 due to the failure of Stan Lee Media Company. To protect his comic book characters, he put them under a new company called POW! Entertainment. Lee is now in the black due to the movies based on his comic book heroes and villains.
  3. Donald Trump – Before he was president, Trump was a ruthless businessman. He declared bankruptcy due to failed ventures in 1991, 1992, 2004 and 2009. It’s important to note that none of the bankruptcies were Chapter 7.

Bankruptcy: A Turning Point

Some of the bankruptcies above could have been prevented. Regardless, the only logical solution was to declare bankruptcy, whether it was a Chapter 7, 11 or 13. These celebrities did not let their bankruptcies keep them down. They bounced back financially and or physically (changed their lifestyles).

The same can happen to you with the right bankruptcy attorney. A bankruptcy lawyer knows which type of filing is right for your situation. Before you decide on an attorney, we suggest you go over all of your expenses and debts, so that you can see your financial status.


At Cibik & Cataldo, we offer a free consultation to help you understand bankruptcy, including the civil court. Contact us today to schedule your appointment!

sign in a field of grass that says "chapter 13"


By:Mike Cibik


When facing a debt(s) that has spiraled out of control, filing for bankruptcy may be the only option. Bankruptcy has become a shameful word. At Cibik & Cataldo, we feel it shouldn’t be; it’s just a financial solution. We are not saying it should be abused, but it makes life a lot easier, and you can start over financially. Chapter 13 means that you are keeping most of your assets, whereas a Chapter 7 bankruptcy means you are liquidating practically all of them. It is a positive step towards fixing your finances.

When faced with filing, you shouldn’t get just any lawyer; you should get a bankruptcy attorney. Bankruptcy lawyers solely deal with these situations. They aren’t spreading themselves thin with other practice areas, such as wills and DUIs. Filing for bankruptcy is a last resort, and careful consideration must be applied before filing as well as choosing the right type of bankruptcy.

Advantages of Chapter 13 Bankruptcy

During this process, it’s best to look at the benefits of a Chapter 13. When you choose a Chapter 13, you are saving your home from foreclosure. You want to keep it and other assets, such as a car or non-exempt property. To file, you must have a regular income and not have more than $250,000 in unsecured and more than $750,000 in secured debt. The advantages are:

  1. Stopping a Foreclosure – You must still make the mortgage payments, but the threat of foreclosure is gone. You can also catch up on missing mortgage or car payments too. You must file for Chapter 13 before the foreclosure sale.

  2. Achieving Long-term Financial Health – Since you are making one monthly payment to a bankruptcy trustee, you will get into the habit of budgeting. Once discharged from the bankruptcy, you will be in better financial shape, and you may turn the monthly payment into a savings account.

  3. Protecting 3rd Parties – This protects those who are liable on “consumer debts.” Thus, those who co-signed in a loan are protected.

  4. Rescheduling Payments – You can reschedule secured debts and extend them over the payment plan.

  5. Removing 2nd Mortgages – This type of bankruptcy can remove 2nd or higher mortgages, giving you more room to make your primary mortgage payment. This is called lien stripping. You must qualify for it – your home must be equal to or less than the primary mortgage. When the bankruptcy has been discharged, the lien is stripped away. Lien stripping can also apply to car loans.

  6. Helping with IRS Issues – Some taxes can be discharged as unsecured debts (e.g., a medical bill). Thus, you are not paying the interest on the taxes. Also, since liens can be removed from a property, you can pay less than the amount of the lien depending on the amount of property equity.

  7. Including Student Loans – They can be included in the Chapter 13 payment plan.

  8. Filing for Bankruptcy Again – If you have filed for Chapter 7 bankruptcy in the last eight years, you can file for Chapter 13 bankruptcy. Also, debts that could not be discharged in Chapter 7 can be reduced in a Chapter 13.

Handling Bankruptcy Cases in Philadelphia

Our team of bankruptcy attorneys here at Cibik and Cataldo know Chapter 13 bankruptcy inside and out. They know what you can and cannot keep in this type of bankruptcy and how to set up an affordable payment plan. We know this is a stressful time for you and your family. Let us show you how easy it is to file. Call today at (215) 735-1060 or fill out a quick contact form to schedule a free consultation to meet with you.

woman sitting at table working on finances


By:Mike Cibik

Let’s be honest. No one wants to declare bankruptcy of any kind, whether it’s a Chapter 7 or 13. We try to control our finances, but life happens. When the only solution is bankruptcy, it’s important that you understand bankruptcy, including how it affects your credit report.

In the past 20 years, filing for bankruptcy has become as common as applying for a loan. No matter the reason, going through a bankruptcy is hard, but it will not destroy your credit report. Yes, it will be a black mark on it, but the depth of the mark differs among the bankruptcies. They both have the same effect, so it comes down the creditor reviewing your credit report, and the time it takes to rebuild your credit.


Chapter 7 Bankruptcy: A Faster Way to Build Credit

Chapter 7 and Chapter 13 differ in time and money. A Chapter 7 bankruptcy has a quicker process and doesn’t involve repayment. Some wonder if it’s better to choose a Chapter 13 bankruptcy because they are making an effort to pay back their creditors. Again, it depends on who is reviewing your credit report. But, many banks look favorably on Chapter 7 because these debtors do not have put all their disposable income toward the payment plan of Chapter 13.

The filing process for a Chapter 7 is less than six months, as opposed to three to five years for a Chapter 13. This way, those who filed for Chapter 7 can rebuild their credit faster and get on a better financial track with credit cards designed for those who just obtained a discharge.

Keep in mind, these credit cards come with a high-interest rate, but after some time, you will be able to get a credit card with a lower interest rate. Your credit score will increase a year post-discharge, so you’ll be able to apply for loans (car and home). Also, a Chapter 7 is cheaper than a Chapter 13 not only with the bankruptcy attorney fee but there is nothing to pay back.


Keeping your Assets with Chapter 13 Bankruptcy

With a Chapter 13 bankruptcy, you still retain your assets. This may be appealing to a creditor. Also, this type of bankruptcy stays on your credit report for 7 years (from the date it’s filed), whereas a Chapter 7 will stay on your credit report for 10 years. Also, some banks may look favorably on you since you are making an effort to pay off your debts with a payment plan.


Bankruptcy & Credit Reports

When something involves bankruptcy, Chapter 7 or Chapter 13 bankruptcies tend to leave people worrying about their future – their credit report/score. The FICO credit score determines the type of loans you can get and credit cards post-bankruptcy. It’s important to note that your FICO credit score is based on a scoring model (formula). There are 28 popular FICO scoring models, each one based on the type of loan. Thus, the faster you can build up your credit score, the faster you can put the bankruptcy past you.


The Bankruptcy Experts in Philadelphia

At Cibik & Cataldo, we specialize in bankruptcies, particularly Chapter 7 and Chapter 13. We will review your financial situation to determine which type bankruptcy is right for you. We know the latest changes to bankruptcy law to help your case be processed quickly and smoothly. Bankruptcy is not a black-and-white situation; there are many gray areas. We will help you understand the gray areas and more to help you will feel confident about your decision to file and to hire us. Call or email us today for a free consultation!

dollar sign frozen in an ice cube


By:Mike Cibik


At the Equifax credit reporting agency, a data breach has left many Americans feeling insecure and vulnerable. If you are wondering what the breach was about then you would be shocked to know that millions of Americans had their sensitive information like their social security numbers, date of birth, credit card numbers and in many cases, driver’s license numbers stolen. The hackers went as far as stealing information of people in the UK and Canada too.


You can check if you have been a victim (before you contact a bankruptcy lawyer) by clicking on the www.equifaxsecurity2017.com and entering your last name and last 6 digits of your social security number. Regardless of whether you have been a victim of Equifax or not you should freeze your credit score.


What is credit freeze?


A credit freeze makes your credit score inaccessible to hackers and people with malicious intent. It makes it difficult for them to steal personal information and open accounts in your name. Since new accounts require a credit score, a credit freeze puts a restriction. Your existing creditors can still access your credit scores but, you will have to request a temporary lift of the freeze for any new credit lines or account opening.


A lot of people are apprehensive to put a freeze on their credit score.


Rest assured that a credit freeze:


  • Doesn’t affect your credit score


  • Doesn’t prevent you from getting your free annual credit score report


  • Doesn’t prevent you from opening a new account, apply for a home or auto loan, rent a new apartment, get a new job. All you need, is to lift the freeze temporarily.


  • Does not prevent a thief from charging your existing accounts and you need to monitor them.


Putting a credit freeze requires a fee. Most companies charge about $10 to freeze and $10 to unfreeze. The credit freeze remains for a lifetime unless you request a change. Also since there are three credit reporting companies, you need to put a freeze on all three reporting companies (Equifax, TransUnion, and Experian) to get maximum security.


Since your credit score is not valuable when you freeze it, credit reporting companies don’t make it easy (since your data is the product they make money with) for you. They charge a fee to put a freeze and to lift it. The fees though varies from company to company.


How to do freeze your credit?


  • Here are some ways you can put a freeze on your credit account.


  • You can do a credit freeze online. Check to see if there is a reduced fee in case you are a senior citizen. 
  • You can write a letter and send it via certified mail. You can even request a freeze on your minor child’s account.


  • You can do it over the phone too.


Who can see my credit report after freezing?


Your report will be accessible to your existing creditors and/ or debt collectors. This is important in case you are planning to file for bankruptcy. Your bankruptcy attorney will be the best person to guide you here.


The government also has access to your credit report in cases where you have to respond to a court order or an administrative order or a subpoena.


What other measures can be taken to prevent a security breach on your account?


  • Being alert is always a help. In this case, paying attention to unexpected calls or emails asking for your credit card number or money.


  • Monitoring your credit report every year and checking for errors.


  • Setting up alerts for all your accounts and checking for any suspicious activity is also a good idea.


  • If you think there is fraudulent activity in any of your accounts, then report it to the concerned authorities.


  • Filing your taxes early can also prevent hackers from stealing information and filing fraudulent taxes in your name.


Your credit report is key to your financial success, and it is important that you consult an attorney if you have any doubts. If you want to file for bankruptcy, then your bankruptcy lawyer can help you understand how a credit freeze will affect your filing.


For a free consultation talk to one of our Philadelphia bankruptcy attorneys at Cibik and Cataldo at 215-735-1060.


income tax refund from the irs sitting on desk




If You File for Bankruptcy Can You Pay Off Debt with Your Tax Refund


A sudden income or monetary gain from any source is always a matter of relief for the receiver. However, if a person has been going through considerable financial crisis leading him/her to be in subsequent debt, this gain can seem all the more godsend.


A tax refund is one such financial bonus that comes to you without you putting in a lot of effort or planning. Now, if this refund is of a sizeable amount, you can actually utilize it to pay off certain debts. A tax refund can be used to wipe out credit card debt, educational loans and the likes provided that you channelize the money in the right direction.


But before going into the details of the best ways of using your refund amount, let’s look into how tax refund is a financial gain for you.


How Can You Financially Benefit from the Tax Refund?


A tax refund is like a blessing in disguise for anyone who is in debt, especially after recovering from a bankruptcy case. The extra dollars give you a one-of-a-kind opportunity to manage your debts in the following situations:


If you have a compound interest loan, it is definitely a financial burden on you because the interest rates for these loans accumulate much faster. You can use the refund to pay off the interest portion as much as possible.


You might be paying the loan installments regularly and yet you have a long way to go for full repayment as you cannot reduce the principal amount. In such a situation, the tax refund is your chance to repay a certain part of the principal amount so that the interest is lower next month.


If you are unable to pay your credit card debt, leading to a not so impressive credit history, you can use this refund to pay off and let it get reflected on your credit score.


If you are on the last lap of loan repayment, it is the refund again with which you can steer clear of all debts whatsoever.


How to Use the Tax Refund in the Best-Possible Way?


Being in immense financial debt that is a burden to pay off is the main reason why people file for bankruptcy. Just as you have to seek the assistance of a bankruptcy lawyer in coming out of a difficult situation, you have to learn the ways of utilizing the tax refund to your maximum benefits too.


The question arises as to which debt you should pay off first or whether you should repay the loans with higher interest rates or those with relatively smaller ones? Now, the way you strategize your financial activities largely depends on your situation, especially the terms and amount of your specific debt.


For starters, it is essential for you to use the tax refund amount in paying off debts, in which you are lagging behind. Addressing this crisis immediately ensures that you prevent the arrears, additional fees etc. from adding up to your main balance.


All this can ruin your financial credibility in the long run by affecting your credit score.


If you are unable to tackle a large amount of debt but can pay the minimum about; you should use your refund to pay it off.  When a part of the largest balance gets paid off, the future monthly payment amounts automatically get reduced.


That being said, it is not always possible for all your debt to have similar rates of interest. When it comes to deciding on whether to pay the highest or the lowest interest rates, you have to make a calculation.


The small debts with higher interest rates are more damaging than the higher debts with lower interest rates. That is why; it is usually advisable that you use your tax refund in targeting the accounts with higher interest rates, even though they might not have the highest current balance.


Paying off small amounts can also give a sense of satisfaction and accomplishment at having cleared a part of your debt. If you are unable to decide and choose the right course of action, you can always consult a bankruptcy attorney.


If you are contemplating filing for bankruptcy, you may be aware of the pros and cons of filing. Talk to us at Cibik and Cataldo, you can reach us at 215-735-1060  and talk about why people file for bankruptcy and if it’s advantageous in your case.

really bad credit report on a table


By:Mike Cibik


Many people consider filing for bankruptcy if they struggle with debt and have financial difficulties. While bankruptcy may help you gain financial freedom, it is not a permanent solution. You may further face troubles in securing loan or credit due to the appearance of bankruptcy on your credit report. Hence, you may want to know how long the bankruptcy will keep showing up on your credit report?


The Significance of Chapter 7 & Chapter 13 Bankruptcy


Usually, the negative items including bankruptcies appear on the credit report approximately for seven years. This is categorized under foreclosures, Chapter 13 bankruptcies, unpaid taxes, late payments, and collections. Chapter 7 bankruptcy remains on the credit report for up to 10 years.


Though, both the chapters are applicable on bankruptcy cases, people with low income mostly qualify for Chapter 7. While Chapter 7 eliminates all debts, a Chapter 13 bankruptcy restructures debts. Most debtors prefer Chapter 13 bankruptcy, as it allows them to keep their assets and repay only a portion of the debt.  These debtors can repay some money and are people with higher incomes. Though Chapter 7 bankruptcy is easier and faster, it’s serious and thus, it remains on the credit report for a longer period of time.


However, the bankruptcy timelines may also differ depending on the fact whether bankruptcy was discharged or dismissed by your credit reporting agency. For instance, Equifax keeps dismissed bankruptcy for 10 years, while discharged Chapter 7 bankruptcy stays for seven years on the report.


Sources of Credit Report


You can obtain a copy of your credit report either from Experian or Equifax or the Transunion. Your Credit report will show the credit card accounts, loans, payment history and balances, liens and bankruptcy. Consider your credit report before applying for fresh credit. In case you have any doubt, contact your bankruptcy lawyer immediately.


Timelines of Bankruptcy


It usually depends upon the category of negative information. The following breakdown will help you understand the bankruptcy timelines on your credit report:


  • Public Record – Normally 7 years, however, unpaid taxes may remain for an indefinite period.
  • Foreclosures – Will remain on your report for 7 years
  • Bankruptcies – 7 years for Chapter 13 and 10 years for Chapter 7 bankruptcies.
  • Collections – Normally 7 years, depending upon the period of the debt being collected.
  • Late payments – Similar to foreclosures, it remains on the record for 7 years.


These are the most common information about bankruptcy timelines. If you are stuck in financial difficulties, discuss your case with a Philadelphia bankruptcy lawyer in order to get the most appropriate suggestion.


Bankruptcy Attorney


If you are looking to buy a new home or car, filing for bankruptcy may shatter your dreams. Consulting a Philadelphia bankruptcy lawyer can help you save your property such as your vehicles and your home and would help you make a new financial start.



Future Lenders become alert


If you have filed for bankruptcy in order to wipe out credit card debt, your future lenders may become attentive in lending you further debts. Your creditors might also refuse to extend credit or offer you credit on a greater interest rate.


Though you may face difficulties in obtaining insurance, mortgage loan, or a credit card, some lenders may still want to do business with you. Creditors may find you less risky since they know that you would not be allowed to file for another bankruptcy for several years.


Also, the discharge you obtain from bankruptcy liberates all your future earnings from the past creditors’ claim. Eventually, you become a prospective customer for them as you have more funds on hand to spend.


Since bankruptcy comes with various pros and con it is not advisable to file for bankruptcy merely for wiping out credit card debt.  There are various alternatives you may consider in place of bankruptcy. Consult your bankruptcy attorney immediately to get the best suggestion for your case.

A bankruptcy may drastically affect your life and limit your capability to secure loan and debt in the future. It may stay on your credit report for many years and may possibly disrupt your financial position. If you’re considering filing for bankruptcy, talk to one of our experienced Philadelphia bankruptcy lawyers at 215-735-1060. We have helped thousands of people make informed decisions and give them a way to start fresh.

close-up of court house showing "united states court house" on front


By:Mike Cibik


Tearing your hair apart when you find yourself drowning in debts is certainly not going to make the situation any better. You do have to take stock of your situation and try to get out of the legal wrangle as best as you can. One way to earn a respite in such a situation is by filing for bankruptcy.


If you think if you file for bankruptcy you have to attend the US bankruptcy court frequently, thankfully that’s not the case. Chances of you never ever setting foot into the hallowed building are definitely possible.


However, you may have to attend a meeting that will hardly take more than 15 minutes of your time. The 341 meeting, as it’s called, is all important though and you must make sure to attend it accompanied by your bankruptcy lawyer. Do not be scared by the umpteen number of horror stories circulating around, however. A legal professional would certainly be the best person to help you in understanding bankruptcy along with the pros and cons even before you file.


Facts about the 341 meeting


This meeting, also known as the ‘creditors meeting’ is fairly informal and you need not be concerned about maintaining formality at all. The bankruptcy attorney representing you will be sure to inform you about the do’s and don’ts though. Rest assured, the meeting will take place in presence of all or some the creditors as well as a trustee appointed for overseeing your case. You will find the trustee questioning you closely about the debts that caused you to contemplate bankruptcy and you should answer them honestly.


Chapter 7 Bankruptcy


Do not be alarmed to find a number of questions asked about the value of the property in your name that is not exempt. In other words, you will have to reveal everything that you own at the moment. The trustee will make sure to consider the value of each property and decide whether they can be sold off in order to obtain the outstanding amount that you owe the creditors.


Be sure to reveal every detail pertaining to your income and expenses truthfully. Most 341 meetings are wrapped up in a straightforward manner. You will hardly have to spend more than 5-10 minutes answering the questions, therefore. A word of caution here though! You would be well advised to discuss the entire matter with a bankruptcy lawyer of repute before attending the ‘creditors meeting.’ This will prepare you for the questions you are likely to face at the meeting.


Chapter 13 Bankruptcy


While the meeting is likely to include almost everything discussed in a meeting based on Chapter 7 Bankruptcy, this one may require a few additional minutes for discussing the adjustment procedures. So, go ahead and feel free to speak about your expenses and income.


Your plan for repayment would also be discussed at length by the trustee. There is certainly a chance of all your creditors who will be keen to attend this meeting in order to ensure that each of them is treated at par during repayment. Relax! This meeting will be as informal as the 341 meeting as well.


‘Confirmation Hearing’


A ‘confirmation hearing’ is almost sure to be held shortly after the ‘creditors meeting.’ It will be held at the ‘US Bankruptcy Court’ where your proposed plan for repaying your creditors will be discussed extensively and approved by the concerned professional. There is absolutely no need for you to be present at the hearing though. Your legal representative can act on your behalf.




You can choose not to visit the court for bankruptcy proceedings while your case is up for discussion. Yet there are certain instances when your presence becomes mandatory. You just cannot avoid entering the courtroom when one of the creditors accuses you of committing a fraud.


Likewise, you may also have to go to the court when a creditor is not satisfied with the exemptions that you claim during filing a bankruptcy. Unfortunately, falling behind your repayment plan may cause a creditor to request an intervention of the court. You will also have to obtain a court approval if you want to make amendments to the proposed plan later on as well.


To see whether you qualify and get all your questions about bankruptcy answered talk to a Philadelphia bankruptcy attorney at 215-735-1060.

woman thinking about money


By:Mike Cibik


Trying to make ends meet is possible even when you have a limited income. Unfortunately, you may decide to borrow slowly at times and find yourself bogged down with debts. If you are at your wit’s end, there is a way!


There is a provision to file for bankruptcy when your financial position looks bleak. It is going to reduce your economic woes considerably. You are indeed not alone! In fact, a lot of celebrities have gone down this road before.


From the cable TV host Larry King to Johnny Depp and Toni Braxton the list goes on and on.So there’s no need to worry unnecessarily.


As every case is different, it’s in your best interest to find out the facts pertinent to your situation by getting in touch with the top bankruptcy lawyer in town. You should retain all your bills as well as the pay stubs when you are contemplating such a move. Fortunately, your bankruptcy attorney will be able to help you during the process by providing you with timely assistance.


Remember that you may have to do certain things and also avoid doing specific ideas to get your current records straight before declaring yourself to be bankrupt.


Understanding bankruptcy is not too tricky though. You can read up and remain abreast of the facts or contact the best legal professional in your area for help.


You certainly have to tread with caution while filing for bankruptcy. Be sure to follow the advice of a Philadelphia bankruptcy attorney when you happen to be a resident of the city. Filing incorrectly will only add to your woes. So do it right the first time. Good Luck!


Settling the Debts – Do not go frantic trying to raise money for paying off all your bills. Remember that you would be declaring your inability to pay off your creditors by filing bankruptcy. So if it’s affecting your financial situation hold off on paying your credit card bills.


You can opt for Chapter 7 bankruptcy for being absolved of your responsibilities wherein your bills will be discharged totally. Or you can decide to pay off your debts easily by choosing to file for Chapter 13 following the bankruptcy law.


Asset Transfer– Your case is likely to be dismissed outright if you decide to hide some of your assets before filing. Do not even think of transferring your property or car plus any of your other tangible assets to your family members or friends.


The bankruptcy court is sure to uncover the facts in every detail of your financial dealings will be checked with a fine-toothed comb when you file. Any discrepancy discovered within the stipulated time will not only result in having your bankruptcy plea dismissed, but you may also be penalized for fraud.


Retirement Fund – Well, your retirement fund is exempted when you file for bankruptcy. Do not even think of using this nest egg to pay off your dues. You will only end up with additional debts that could have been avoided in the first place. The same applies to other kinds of 401(k) loans. Do not pounce on the money and use it up. It is best to obtain the help of a bankruptcy attorney before contemplating such a move.


Credit Card Dues– Sure, you know that your credit card bills are likely to be discharged once your bankruptcy case is approved by the court. However, you will put yourself at a disadvantage by spending lavishly via your credit card just before you file. The court certainly frowns on such an act and would decline to discharge the debts that you had incurred in the last three months before bankruptcy filing.


Self Filing – Yes! You know your financial position perfectly. Unfortunately, the same cannot be said about your knowledge of bankruptcy law. Beware of handling the bankruptcy filing yourself. There are many pitfalls in the way that may land you in trouble. It is always better to pay a small amount as legal fees than having to face failures and delay the progress of your case.


An able bankruptcy lawyer will represent you at every stage right from handling the paperwork to answering the questions put forth by your creditors as well as representing you at the bankruptcy court. So, go ahead and hire an attorney to ensure your peace of mind.


Bankruptcy is the process that helps people and businesses prevail over an extreme financial condition where it gets impossible to pay their bills and debts. The core purpose of bankruptcy is to help taxpayers and law-abiding citizens get a hassle-free exit from their financial chaos and get a fresh start. Consult one of our experienced bankruptcy attorneys at Cibik & Cataldo P.C. immediately at 215-735-1060 to get yourself out of the financial mess and start afresh.If you would like to discuss your case, feel free to give us a call at  215-735-1060.

many different people standing together


By:Mike Cibik


What Kind of People Get Rid of Debts When They File for Bankruptcy?

My office focuses on consumer bankruptcy. As an attorney in an urban community, I am often asked about my clients and how folks can just walk away from debts. I am asked how I can sleep at night, knowing I have assisted folks with getting rid of creditors. My answer is:  “I sleep quite well, thank you!” and “the kinds of people you work for, work with, go to church with, marry, all kinds of people file bankruptcy.”


There are many articles about celebrities who have filed for bankruptcy, and many articles on this site about famous folks who have filed for bankruptcy protection. But, for every celebrity, there are many other folks who live quiet lives of desperation, who worry about what will happen when the bankruptcy petition is filed, whether they should file a Chapter 13 or a Chapter 7, or the bigger question: How they will pay for the process. Who are they?


Recently, I met with a couple who cleared six figures – but their child had been life-flighted to a major urban area twice for specialized care at a children’s hospital. Their insurance wouldn’t cover an $80,000 life-flight bill. And they had no hope of paying for it, as one parent had to now stay home to care for the child, and there would be continued weekly trips back to the urban center for treatment.


Also recently, I met with an 80-year old woman whose social security was being administratively garnished by a government agency and who was left with approximately $890 to pay her rent, food, utilities, and medications not covered by Medicare. Not surprisingly, she lost her apartment. Did the garnishing government agency care?  Nope.


I see folks from all walks of life – the line worker to the president of the company to the manager. None of them are happy to see me or want to be in my office.


The team at Cibik & Cataldo P.C., are here for you in your time of need. If you or someone you know is having financial problems, stop worrying and call Mike Cibik at (215) 735-1060 for a free consultation.

close up view of the front of a chip credit card


By:Mike Cibik


Having a credit card is a matter of convenience. It enables and empowers you to make investments and buy things for which you are not required to pay up front. However, a credit card is a powerful financial tool, which needs to be used with care to prevent financial damages.


So, when you consider the option of opening a new credit card account, there are several factors that must be taken into account. Again, if you have ever filed bankruptcy, getting a credit card after such an episode, would require considerations of a different level altogether.


So, before understanding bankruptcy related after effects on procuring a credit card, let us look into some general considerations before choosing a credit card:


To begin with, your spending habit is the foremost thing to consider. Choose your credit card based on whether you are going to pay the entire bill every month, carry a balance or use it as a go-to-card for most of your buying needs.


Every credit card comes with an interest rate or what is called an annual percentage rate(APR). Now, even when you choose a credit card with a fixed rate of interest instead of a variable one, be aware that this rate can change in the long run. Also, the interest rates increase every time you spend over your credit limit or make late payments.


There is simply no dearth of fees and penalties when it comes to owning a credit card. Apart from the fees for transactions, there are charges on balance transfers, cash advances and so on. Issuers often keep asking you to increase your credit limit and make a payment by phone.


Balance computation is another trick you should be aware of. If you are going to carry forward a balance, take note of how this charge is calculated. The most common method involves adding together the daily balances and then dividing the sum by the number of days in the billing cycle. In this regard, avoid cards that compute the balance using two billing cycles.


Credit cards come with incentives and reward programs, which are beneficial. However, look for restrictions or expiry date of the programs so that you don’t end up losing your hard earned points. There can be certain limits on how many points you can earn, which should be considered carefully as well.


Getting a Credit Card after Bankruptcy


Applying for a credit card after filing bankruptcy should be discussed with your Philadelphia bankruptcy attorney. Filing a chapter 7 lowers your credit score to a certain extent, which remains the same for ten years from the date of filing the bankruptcy. However, in such a situation, it is not impossible or undesirable to open a new credit card account, only if you consider the following aspects:


Make sure that you have corrected your spending habits and can now, do justice to the financial power that a credit card offers you. If you consult your bankruptcy attorney, he/she might still be against the idea but it is you who have to ensure that there will be no further debt.


Adjust your expectations and know that the credit card facilities you earlier had will not be available now. The cards with higher credit limits and lower interest rates are reserved for customers with good credit score. In fact, your attorney might ask you to avoid applying for cards that you included in your bankruptcy. The simple reason is that these companies might deny your credit card application concerning your financial history.


You can consider applying for a secured credit card, which requires you to deposit the credit limit. After bankruptcy, it is more likely for you to get approved for these cards. These cards are considered less risky by the credit card issuing company or bank. Also, these can help you keep track of your expenses and check your spending habits at the same time.


Above all, if you are applying for a credit card after bankruptcy, make sure seeking the approval and guidance of your bankruptcy lawyer to avoid uncalled for situations from arising in future. If you would like to discuss filing for bankruptcy, the pro’s and con’s do give us a call at 215-735-1060.