How Bankruptcy Can Help or Harm You
If you are deeply in debt and unable to pay, you may have been considering bankruptcy to ease your financial burden. This is definitely one possible strategy, but it can have consequences you might not be aware of. If you have questions or need advice about filing bankruptcy, you’ll want to have an experienced legal team like Davis, Ermis, & Roberts P.C. on your side.
We understand the stigma that some people attach to bankruptcy. Some see it as a sign of financial irresponsibility. Many Americans hesitate to file because they don’t want to feel judged by others. However, the truth is that sometimes bankruptcy is unavoidable, and poor financial planning isn’t always to blame.
At Davis, Ermis & Roberts, P.C., we know people file for bankruptcy for all sorts of reasons. Some lose their financial stability to divorce. Others go bankrupt after spending all their money on medical treatments. The important thing to remember is that we never judge our clients for the circumstances that brought them to us. We also know about how to navigate the bankruptcy process so you can put this phase of your life behind you and move on to better days. If you’re considering filing for bankruptcy, reach out to us as soon as possible.
Let’s take a closer look at the benefits and consequences of bankruptcy.
The Pros of Filing Bankruptcy
- Debt Forgiveness. It’s true that you can discharge your debts by filing for bankruptcy. In a Chapter 7 bankruptcy, the debts are forgiven and you are no longer responsible for their payment, but your assets are sold off. A Chapter 11 or 13 bankruptcy allows you to restructure your debts into one manageable monthly payment.
- Automatic Stays. Once you file for bankruptcy, the court will issue an automatic stay. An automatic stay prohibits your creditors from making collection attempts on your debts. This will immediately put a stop to stressful phone calls or letters you may be receiving from collection agencies.
- Bankruptcy Exceptions. Bankruptcy exemptions are assets that cannot be seized during Chapter 7 bankruptcy filings. This means that if you file for Chapter 7, you can possibly keep your home, clothing, jewelry, and certain other personal belongings.
The Cons of Filing Bankruptcy
- It Doesn’t Eliminate All Debts. Some debts cannot be forgiven due to bankruptcy. These include your most recent unpaid taxes, student loans, child support, alimony, and government fines.
- It Hurts Your Credit. A bankruptcy will negatively impact your credit for up to 10 years. This will make it much harder to secure a mortgage, car loan, or even a credit card. If you do manage to get a loan, you will pay a much higher interest rate than someone with clean credit.
- It Takes Time and Money. The costs of filing for bankruptcy add up, but you still might be better off than you would be if you did not file. To make sure you are getting the very best legal representation, hire a bankruptcy specialist like Davis, Ermis, & Roberts P.C. to represent you.
Call Davis, Ermis, & Roberts P.C. Before You File
Sometimes good people find themselves in a bad situation, and sometimes bankruptcy is the only way out of that situation. Don’t file until you’ve spoken to an experienced bankruptcy attorney like the ones at Davis, Ermis, & Roberts P.C.
If you’re tired of being harassed by debt collectors and ready to move on with your life, call us right away for a free consultation. We will evaluate your situation, help you gather all the necessary documents, and show you that there is life after bankruptcy.