LEGAL GUIDE
Written by attorney Kenneth Lee Sheppard Jr.

Is Bankruptcy Right For You?

Are you and your family in financial trouble? Many people believe that they need to avoid bankruptcy at all costs; however, it might be the tool necessary to get yourself out of crippling debt.

More and more hard-working Americans are finding it increasingly difficult to keep up with mounting bills and mortgage payments. One family emergency may be enough to send their budget over the edge, seemingly leaving them with no options. If this is your situation, you may have more options that you believe. Although filing for bankruptcy has come to possess a social stigma, this is not the true intent of this process. In fact, it was designed specifically with the debtor in mind. Lawmakers understand that people who have worked hard their entire lives may suddenly find themselves trapped by debt, through no fault of their own. With the added factors of a slow job market, weak economy, and poor housing market, it is understandable that families and individuals throughout the country are considering bankruptcy.

So what stops people from getting a fresh start through bankruptcy? Perhaps one of the reasons is that they believe the myths they have heard regarding bankruptcy. Instead of investigating to see if they could benefit from this financial tool, they believe the rumors and accept whatever happens. One myth of bankruptcy is that those who file for it will lose everything. This is not true for many reasons, one of which being that there are different types of bankruptcy. Chapter 7 bankruptcy is also known as liquidation bankruptcy and it involves selling some assets in order to discharge debts. Debtors who choose this route may be able to keep some loans, such as car loans, so that they do not lose all of their belongings. Creditor harassment, if it was occurring, will be put to a halt, as will any wage garnishment that was occurring. However, not everyone qualifies for this type of help so it is helpful to meet with a legal representative to see what is available in your case.

If you do not qualify for filing for bankruptcy under Chapter 7, Chapter 13 bankruptcy may be a viable option for you. This allows debtors to create a repayment plan that can span over three to five years. If you do not believe that bankruptcy is right for you, there are other options of debt relief. For example, if you are being threatened with losing your home, you may wish to decide to apply for a loan modification. This could cut down on interest rates, late fees, as well as your overall principal. A short sale is another option that may suit your specific needs. If the market value of your home is less than the amount you owe on it, the bank may allow you to sell your home and forgive the remainder of your debt. Whatever your case, it is always advisable to have a strong legal advocate on your side both to fight for your rights as well as provide you with the counsel you need to make the best decision for you.

Additional resources provided by the author

If you have questions about bankruptcy or bankruptcy alternatives, Sheppard Law Offices may be able to help you. With years of experience in helping those who have found themselves in financial trouble, this team of professionals is here for you. A Columbus bankruptcy attorney from their team could assist you in Chapter 7, Chapter 13, filing for bankruptcy, bankruptcy myths, and more. Contact a Columbus bankruptcy lawyer as soon as possible. They offer a free consultation, so call today!

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