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Pros and Cons of Filing for Bankruptcy

Pros and Cons of Filing for Bankruptcy
"Before proceeding with a bankruptcy filing, it is important to comprehend the advantages and disadvantages.

Positive Features

You are given a blank slate. Depending on the sort of filing, your existing unsecured debts are discharged, and payment schedules are created for secured debts such as a mortgage to facilitate payment.

It puts an end to the harassment. Creditors and collection agencies are fond of calling at all hours of the day and night to demand payment, which can leave you feeling overburdened. Once you have filed, they are prohibited from harassing you. All correspondence will be conducted through the court or your attorney.

Prevent your home's foreclosure. Because a plan is devised to make payments that the bank, the court, and you all consent to, you will not lose your home, vehicle, and other necessities.

No more credit cards allowed. You have canceled all of your credit accounts to eliminate temptation. Now is your chance to learn a new lifestyle that will benefit you once you are eligible to apply for credit again. You learn to budget and save for large purchases rather than using credit cards.

Negative Features

Your credit is ruined. Your bankruptcy will remain a red flag on your credit report for ten years. It can prevent you from obtaining a job, buying or renting a residence, purchasing a vehicle, obtaining insurance, and obtaining credit lines.

You have misplaced all of your credit cards. It will take many, many years to regain the creditors' trust before you can obtain another credit card. This is not inherently negative, but in a society where plastic is prevalent, it can hinder certain purchases. In addition to credit cards, the court may seize and sell other non-essential items to cover a portion of your debt.

It becomes common knowledge. There is a stigma associated with the word bankruptcy, and if you apply, you must publish a public notice in the local media for all to see. Regardless of how you arrived at this position, others will draw their own conclusions.

4. Not all obligations are discharged. Your student loans and tax arrears cannot be discharged. If you want to retain your home, you must create a payment plan.

Regardless of how you got into this situation, there may be no apparent path out. An experienced bankruptcy attorney can assist you in weighing these factors and determining the best course of action.""

" - https://www.affordablecebu.com/
 

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"Pros and Cons of Filing for Bankruptcy" was written by Mary under the Finance / Wealth category. It has been read 163 times and generated 0 comments. The article was created on and updated on 03 June 2023.
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