What Is Filing For Bankruptcy?

What Is Filing For Bankruptcy?

Many people that find themselves in grim financial situations would never consider the option to file for bankruptcy. Bankruptcy often comes with its own stigma and a reputation that it could ruin a person’s finances for years to come. Filing for bankruptcy can be the best option for a person to overcome their unique financial circumstances. Deciding if you should file for bankruptcy can be a complicated process and understanding the full consequences of filing is something that needs to be considered. Working with a skilled bankruptcy attorney can be an excellent way that you can navigate the challenges associated with bankruptcy and know the full effects that bankruptcy may cause as a result of your filing process. To answer your question “what is filing for bankruptcy?”, contact us today if you’d like to learn more about the advantages of filing for bankruptcy and how a bankruptcy might help your finances moving forwards. 

Here are some of the potential advantages that you could experience by filing for bankruptcy:

Immediate Automatic Stay

As soon as you file for a bankruptcy case you’ll be receiving an automatic stay against your account and debt collection activity associated with your finances. An automatic stay is not going to immediately cancel your debt but it can suspend any debt collection action against your case. This could result in zero chance for wage garnishment, ensure that you can keep your home by preventing foreclosure, prevent the repossession of various assets and make sure that any lawsuits on debts can be absolved. If you’re regularly receiving calls or harassing letters from debt collectors all of this are rasping can stop at the moment that you file for bankruptcy it is the automatic stay that will be put into place over your account.

An automatic stay will not have the power to stop any form of a government tax audit, stop the collection of child support or alimony, remove the establishment of paternity, remove cosigners or code debtors from their responsibility, cancel criminal proceedings or stop a government tax audit. 

It’s also important to consider that if you have filed for bankruptcy once within the past year you may be able to petition your court for an extension of the automatic stay so that you can receive less harassment from your creditors.

You Can Discharge Or Cancel Your Debts

Filing for bankruptcy will give you the option to discharge or cancel your responsibility on your debt. If you’re facing tens of thousands or even hundreds of thousands of dollars worth of debt, finding a way to restructure, discharge, or cancel your debts can be important to managing your finances moving forwards.

Keeping More Of Your Assets And Property

You can exempt various assets from being seized in chapter 7 or chapter 13 bankruptcy cases. Various exemptions will allow you to protect up to a certain dollar amount and any asset and the exemption can cover the entire value of that asset in some cases. Protecting various assets could include keeping your jewelry, motor vehicle, home, business assets, and more. If there are various items that are heirlooms you’d like to keep possession of or there are items like your vehicle that you need to get back and forth to work, you can exempt these items in bankruptcy and make sure that you don’t have them seized by your creditors. 

Improvements To Your Credit Score Over Time

Most people are unsure of filing for bankruptcy because they’re worried about their credit score taking a hit after they file. A bankruptcy filing often means having the file for your bankruptcy on record for 7 to 10 years but many debtors start to improve their credit scores as soon as they file for bankruptcy. As soon as a person removes the majority of their dischargeable debts this will allow them to move forward and start rebuilding their credit with a series of products that are designed to help people that are recovering from bankruptcy. Using items like secured credit cards and more can make sure that the process of rebuilding your credit can be done more easily.

Filing for bankruptcy needs to take place at a time where you can make a good financial decision for your future. Depending on your current financial situation it may need more advantageous for you to establish a debt consolidation plan or some form of repayment plan. Having a professional take a look at your finances and tell you what the best path moving forward maybe can be important. If you are interested in improving your financial future consider filing for bankruptcy today with our assistance. We can take a look at the advantages and disadvantages of your current financial situation and how it will be affected by bankruptcy. We can help you come up with an effective solution for resolving your current finances and help you to avoid ongoing difficulty in harassment from your creditors. Contact us to start the bankruptcy process today.