If you face financial challenges and find yourself burdened with excessive credit card debt, medical bills and other types of expenses, you are not alone. According to the U.S. Bankruptcy Courts, over one million Americans filed for bankruptcy, and countless more are still struggling with debt. It can seem impossible to make ends meet when you are unable to make your mortgage payments and pay your monthly bills. At The Law Offices of Douglas J. Powell P.C., we understand how stressful it can be when you are forced to deal with mounting finances. Fortunately, there are many options for those who wish to find freedom from their debt.
If you are considering bankruptcy as a way to clear your financial burdens, there are several types that are available to you. The type of bankruptcy you choose will ultimately depend on the details involved in your specific situation. While Chapter 7 bankruptcy, otherwise known as liquidation bankruptcy, may lead to the repossession of your home, Chapter 13 allows you to keep your home in most cases. This option may be perfect for families who need debt relief but still wish to maintain possession of their property.
There may have been no prouder moment in your life than when your child walked across the stage to receive his or her college degree. That degree was a tangible symbol of the first serious independent decisions your child made without your help. However, if the truth were told, you played an enormous part in that success. In fact, you may pay heavily for years to come.
When a financially distressed individual makes the decision to pursue a fresh start via Chapter 7 bankruptcy, it's important for them to understand that while the process will likely prove to be both mentally and even physically exhausting, it can also prove to be potentially life changing.
While some people may dread filing for Chapter 7 bankruptcy and use it as a last resort in trying to clean up their extensive financial obligations, there are several ways that filing for bankruptcy can be beneficial. People who have a bankruptcy on their record will notice a decrease in their credit score, and may find it hard to be approved for home mortgages, car loans and other financial loans. Chapter 7 bankruptcy, however, allows people to climb out from beneath a pile of financial debt, and gain their footing when it comes to beginning a new future free from debt.
Once you make the decision to file for bankruptcy as a way to climb out of a substantial amount of debt, you face certain negative consequences. There is no question that bankruptcy can have a negative effect on your credit score, which can make it difficult for you to apply for loans, purchase a home and obtain school funding. After your bankruptcy has been discharged, however, you can immediately begin to rebuild your credit and get back on the road to a positive credit score.