Filing for bankruptcy is stressful and may seem like the end of your financial world. It is incredibly overwhelming, intimidating, and, for many individuals, it can be embarrassing. While declaring bankruptcy can affect your credit, reputation, and self-esteem, it also has many advantages. Filing for bankruptcy gives you the chance to start anew and find your way out of suffocating debt.
Continue reading to learn more about the advantages of filing for bankruptcy.
Advantages of Declaring Bankruptcy
Most individuals facing bankruptcy find themselves focusing on the negative aspects of the situation. However, the pros typically outweigh the cons. Take a look at the many positive effects of filing for bankruptcy:
- Discharged Debts — When you file for bankruptcy, the court may discharge some of your debts, meaning your debts are forgiven, and you are no longer liable. Debts that can be discharged include utility bills, personal loans, medical bills, and credit card debt.
- Automatic Stay — The court will issue an automatic stay when you file for bankruptcy. An automatic stay means that your creditors are no longer allowed to make collections attempts on your debts. This means all stressful letters and harassing phone calls you likely have been experiencing from collection agencies will stop. An automatic stay also means that your wages cannot be garnished.
- Bankruptcy Exemptions — Bankruptcy exemptions are property and other assets that your trustee cannot seize during Chapter 7 bankruptcy. Meaning, you may be able to keep some assets such as your home, jewelry, clothing, and a handful of other personal belongings if you file for Chapter 7 bankruptcy.
- Unique Learning Opportunity — It can be humbling to learn things the hard way. However, these difficult moments most often teach very valuable lessons. In this case, when you file for bankruptcy, you will have to take a financial education course to learn better and smarter habits and practices. Take these priceless bits of information forward, and you will have a better grasp on your financial future.
- Begin Improving Credit Score — It is no secret that your credit score takes a serious hit when you file for bankruptcy. While this might be intimidating, it is important to view this opportunity as a fresh start. As soon as you file, you can begin taking steps to improve your score. Yes, it might take some time. However, now is the best time to start rebuilding your credit. A few ways you can start improving your credit score include using a secured credit card, repaying non-discharged debts, and beginning to make on-time payments.
Contact The Law Offices of Charles W. Daff
If the amount of debt you are facing is overwhelming, your only option may be filing for bankruptcy. Attorney Charles W. Daff has over 40 years of experience in bankruptcy law and knows how to help you throughout this stressful process. If you need debt relief and are in Santa Ana, California or the surrounding area, contact The Law Offices of Charles W. Daff to schedule a free initial consultation today.