Unfortunately, society has placed a stigma surrounding bankruptcy, which may deter many from taking advantage of this option. But what is not commonly talked about is that declaring bankruptcy can be a positive thing for many families who are in many different financial situations. Continue reading to learn what the benefits of a bankruptcy filing are and how an experienced Rockland County bankruptcy attorney at The Law Offices of Allen A. Kolber, Esq. can determine whether this is a positive choice for you.
What are the benefits of a bankruptcy filing?
As mentioned above, declaring bankruptcy can benefit many families who are suffering from different yet difficult financial situations. Just some examples of how a bankruptcy filing can aid you include, but are not limited to, the following:
- A bankruptcy filing can offer you financial relief: for instance, if you file for Chapter 7 bankruptcy, your unsecured debt (i.e., credit card debt, student loans, medical debt, etc), and even some of your secured debt (i.e., mortgage loans, car loans, etc) may be discharged. This is made possible because, after filing, your assets will be sold and distributed via liquidation so that your unpaid debts get covered.
- A bankruptcy filing will place an automatic stay on collection efforts: for instance, if you have a lawsuit placed against you, if the foreclosure of your house is being threatened, or if your wages are being garnished, then a bankruptcy filing will make this automatically stop. This is not to say that your debts will automatically disappear. But instead, this means that you will be allotted more time to work out a financial plan that will allow you effectively pay off your debts. This is all while there is no longer the pressure of collection activities, such as threatening calls, emails, letters, etc. This also gives you an opportunity to rebuild your credit.
- A bankruptcy filing can protect most of your properties and assets: for instance, if you have certain properties and assets that you wish to keep, you may be able to do so via a bankruptcy filing. This is so long as these certain properties and assets are considered exempt property. Examples include the house that shelters you, the car that transports you to work, the equipment that you require for your job, etc. Other assets that may be exempt include your retirement accounts, your life insurance policy, your social security benefits, the wages you earned after filing, etc.
Again, these are just some of the positives of a bankruptcy filing. However, these benefits are only applicable if your financial situation calls for it. For help in making this determination, you must consult with one of our skilled bankruptcy lawyers today.