Last updated on October 27th, 2021 at 05:30 pm
Bankruptcy is a court proceeding that comes to the rescue of the person whose debt amount exceeds the value of his assets. It is a legal choice rather than a moral decision when the debt creeps up on you putting you in financial trauma. A bankruptcy consultant has the best expertise in filing bankruptcy thus, saving the person from drowning with a hefty debt.
Shut Out the Debts
The obvious reason for filing bankruptcy is either the complete elimination or dramatic reduction in the amount of debt owed by an individual. The type of debts that can be discharged by bankruptcy includes credit card debt, medical bills, phone and utility bills, and most of the loans. In addition, it halts foreclosures and stops the garnishment of wages by the creditors.
Perhaps, there are some non-dischargeable debts as well, such as students’ loans, alimony, child support, tax liens, fines incurred for illegal activities, and penalties owed to government agencies.
Often misjudged, bankruptcy helps in the reduction of debts under Chapter 7 where liquidation is helping in the discharge of debts. Whereas in Chapter 11 of the Bankruptcy Code the repayment plan is structured to give away the debts.
An incredible element of the bankruptcy code known by most people is the automatic stay. Under this provision, the creditor is prohibited by federal law from contacting you in any possible way to collect the debt. This includes no more threatening phone calls, personnel reaching out to your office and home, or any action taken against you like repossessions, foreclosures, or judgments for debt collection.
Safeguard to Assets
Bankruptcy protects your possessions from liquidation such as home, vehicles, land, household items, clothing, and even cash. The pension accounts for your retirement plans can also be protected. So, when it is said bankruptcy provides a fresh financial start it does not mean from scratch.
Despite the old stigma, filing bankruptcy not only provides relief from the burden of debt but is also very important to the modern economic system. Bankruptcy allows the market to flush away the incompetent business and allocate the funding to an efficient and productive business. It plays an important role at the time of the economic crisis.
It is not a casual process, but a federal law designed to pay unmanageable debts, therefore an expert is required who provides guidance to get you out of this mess by strongly complying with the rules and regulations of the judiciary. The bankruptcy attorneys not only restrict the creditors from violating your rights but also release your debts.
Affordable Sigh of Relief
When one already dealing with a financial problem, one looks for an inexpensive solution to deal with the crisis. The bankruptcy attorney provides the services at very reasonable and affordable fees. The free initial consultation is also given navigating one through the process of filing bankruptcy, even the fee charged by the court is within the reach of the person looking for bankruptcy.
Often considered as the subject of disrespect and fear, bankruptcy provides you the much-needed recovery from the financial debt and stress. Throwing in the towel is better in case of colossal debt to get a fresh start for your finances.