Debt Relief

Property & Assets

Bankruptcy FAQ

Could Bankruptcy Give You a Fresh Start in the New Year?

On Behalf of | Jan 12, 2021 | Bankruptcy

2020 has been a year of trials. From lockdown measures to soaring unemployment, Americans the country over are looking for ways to turn their financial futures around in the new year. What many Americans do not consider is filing for bankruptcy.

Despite its negative connotations, the government designed the bankruptcy process to help citizens going through financial troubles. If you use credit to pay for basics like food and clothing, bankruptcy can help you eliminate debt, control spending and regain your security.

Bankruptcy can provide several benefits

Bankruptcy is a long and complex process, which is why many people hire a trustworthy lawyer with experience. An attorney will work to maximize the potential benefits of filing for bankruptcy:

  • Debt control: Bankruptcy provides an immediate benefit in an automatic stay from creditors and debt collectors. While you and your attorney figure out if Chapter 7 or Chapter 13 bankruptcy is better for you, you will not sink further into debt.
  • Credit score increase: Many people who file for bankruptcy maintain a pretty low credit score. It may take time to increase, but your bankruptcy plan will include clear and fixed payments. As you hit your payment deadlines, your score has a chance to increase steadily and eventually recover.
  • Financial guidance: The bankruptcy plan comes from taking classes with financial counselors who help draft a repayment plan and a working budget. This plan will help cut down on unnecessary spending, consolidate bills and offer helpful tips on sticking to the plan.
  • Flexibility: Every financial situation is different from the next, and bankruptcy tries to anticipate these differences. Bankruptcy focuses on flexibility and negotiation and always comes down to a conversation between people. Finding a lawyer who understands you as a person will help them defend your rights and draft a solution that works for everyone.

Invest in yourself with bankruptcy

Many Americans view bankruptcy in a harsh light and consider it a failure. The truth is that most people who file for bankruptcy do so after several financial crises, many of which are out of their control. In reality, bankruptcy can be a powerful tool with which you can fight back against debt and carve out a secure financial position for you and your family.