Facing Financial Failure: What Are the Benefits of Filing for Bankruptcy?
Tuesday, March 13, 2018, 6:00 AM | Leave Comment
You may feel as though the walls are closing in on you due to your debt load.
Filing for bankruptcy is one option to help you get out from under your debt.
Here are some of the benefits if you’re considering filing for bankruptcy.
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Elimination of Outstanding Debt
Enormous amounts of debt that you can’t possibly pay back is the main reason that people file for bankruptcy. You’re essentially resetting the clock when you decide to take the step of declaring bankruptcy. This allows you to eliminate the debt that you can’t afford to pay back.
The caution with this is that you need to take a hard look at how you got into this situation. Frivolous and uncontrolled spending habits will need to be addressed so that you don’t end up back here again.
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Stopping the Harassment
Having large amounts of unpaid debt may result in you being hounded by debt collectors. This harassment can start to eat at you on an emotional level. You already know that you’re in debt, you don’t need to drudge answering the phone as well.
Filing for bankruptcy allows you to stop the harassing phone calls, emails, and mail. It’s illegal for these debt collectors to continue to contact you once you start the bankruptcy process. You can start to get your life back to normal.
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Opportunity to Rebuild Credit
Bankruptcy wipes out your credit history. The bankruptcy will still be one your credit history, but it gives you an opportunity to start over. This process will take time. You won’t be allowed to open any new credit accounts right away.
After a certain amount of time has passed, you can start rebuilding your credit. This may be the push that you need to learn how to be more responsible with your use of credit. Starting off slow can help you to readjust your lifestyle.
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Protection of Some Assets
Some assets will be protected if you start the bankruptcy process. You may have considered tapping into your retirement accounts or selling property to pay off your debts.
Declaring bankruptcy allows you to keep these assets intact. This can mean the difference between you getting by or being homeless. Having your retirement accounts intact can allow you to still go forward with your retirement plans. You won’t have to start over completely.
There are benefits and risks to declaring bankruptcy. Make sure that you speak with a bankruptcy lawyer before doing anything so that you can get all of the facts.
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Hannah / Freelance Writer
Email: hannahwhittenly@gmail.com
