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Why Some People Are Hesitant To File Bankruptcy

Why Some People Are Hesitant To File Bankruptcy
"""In light of the current economic climate, individuals from all aspects of life are considering bankruptcy as a viable option. Chapter 7 and Chapter 13 bankruptcy are the most prevalent types of insolvency that most people consider. In Chapter 7 bankruptcy, the debtor is able to discharge all unsecured debts, such as credit cards, payday loans, and medical expenses. Any non-exempt property can be sold to repay debts, but this occurs infrequently if the debtor employs cautious planning and an experienced bankruptcy attorney. In Chapter 7 bankruptcy, the debtor can emerge virtually debt-free. In contrast, Chapter 13 is essentially a repayment plan in which the debtor pays back creditors over a period of 3 to 5 years. This is ideal for the debtor who earns too much to qualify for Chapter 7 or who has property, such as a residence, that they wish to keep.

Filing for bankruptcy also provides a highly effective legal instrument known as an automatic stay. All creditors are prohibited from contacting the debtor during the bankruptcy proceeding. This is a tremendous benefit for the stressed-out debtor who has endured months of maltreatment at the hands of extremely aggressive debt collectors.

Why, then, does bankruptcy bear so many negative stigmas that deter or discourage so many from filing? There is a great deal of inaccurate or misleading information circulating around online. Here are a few examples of the most prevalent.

The creditors are not your allies. They will threaten you with imprisonment if you do not pay them. They will tell you that you will never receive credit again or be able to obtain a mortgage and own a property if you file for bankruptcy. This obviously is not the case. The United States no longer has debtor's prisons, and many former inmates receive credit card offers within months of their release. Within a few years, if you are diligent and pay your expenses on time, you will be able to buy a car or a house. Creditors will say anything to convince debtors to pay.

Inaccurate information on the internet - Many individuals who seek answers turn to the internet. This is undoubtedly a potent instrument for gathering knowledge. However, when searching for information, individuals must ensure that they visit reputable websites. The Internet contains both inaccurate and accurate information. After conducting an initial inquiry, you should always consult with an experienced bankruptcy attorney to ask any additional questions and discuss your available options.

Family and Friends - Although family and friends can be reliable sources, they may not always be aware of the truth. You will hear accounts of acquaintances who were forced to declare bankruptcy, suffered a disastrous outcome, and lost everything. This may not be the complete truth of the situation. Even if you believe they have your best interests at heart, many people exaggerate and obfuscate the truth. In conclusion, you should counsel a bankruptcy lawyer for clarification and to discuss your options. Regarding the complexities of the bankruptcy laws, it is always prudent to consult an expert for the best possible outcome.""

" - https://www.affordablecebu.com/
 

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"Why Some People Are Hesitant To File Bankruptcy" was written by Mary under the Finance / Wealth category. It has been read 143 times and generated 0 comments. The article was created on and updated on 01 June 2023.
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