Pros and Cons of Filing for Bankruptcy
Sometimes it is not possible to stop personal disaster from happening. You can lose your job, your car gets damage at a most inopportune time, or maybe somebody you love in your family becomes seriously ill. There are a lot of bills to pay, and the debts becomes bigger than money you earned to pay them off. A situation may occur where you may consider filing for the personal bankruptcy to find financial assistance, but is that the right step for you to take? You can consult with a bankruptcy lawyer if you are uncertain, but you should know that there are pros and cons involved in filing for bankruptcy.
Pros of Filing for Bankruptcy
1. Can be the last resort option and hope
For those who have no savings and a poor budget, bankruptcy may appear to be the last resort option. One should not consider it recognition of failure, however, as different circumstances lead people to file every year.
2. If you file for bankruptcy, creditors cannot continue their debt collection until your case is resolved
When one files for bankruptcy, all creditors are unable to continue their collection attempts until your case is resolved. Many people who file find this is one of the more welcome benefits in that the phones calls and notices dramatically decrease. Filing for bankruptcy allows you the time to sort out your financial situation so you can take the next steps without further anxiety, click here.
3. Loss mitigation can help you, and so you have the opportunity to start over financially
Another benefit to bankruptcy is that, with the help of a good attorney, you do not necessarily have to give up certain assets. Loss mitigation procedures can help keep you in your home, and you have the opportunity to start over financially.
Cons of Filing for the Bankruptcy
1. After filing for bankruptcy, the notice stays on your credit report for a long time.
One item of concern that leaves people reluctant to file is the fact that once you do so, the notice stays on your credit report for about ten years. This mark on your personal financial record becomes an irritating stain that may brand you as a risk in the eyes of others.
2. sometimes even after your case is resolved, to get credit may be hard and you can be given with restrictions as a result of your financial history
You may find, even long after your case is resolved, that it is a challenge to buy a car or new home, or to get financing on furniture and other items. This doesn’t mean, however, you will be turned away every time you apply for credit, but you may be subject to restrictions and higher rates as a result of your financial history.
3. Filing for bankruptcy yourself can lead to potential mistakes that can make the court not to process bankruptcy filing
Also, while you may be saving some money in filing for bankruptcy alone, there are potentially many mistakes that can occur that can cost you a lot more in the long run. The biggest con of filing for the bankruptcy yourself is this potential mistakes like forgetting to put a creditor on your paperwork or missing any deadlines. This can be a big problem because the court cannot accurately process your bankruptcy filing if important information is missing. This can translate into delays and could even mean the instant dismissal of your bankruptcy case by the court. In many cases, therefore, attorney’s fees might be worth the extra expense just to ensure that your bankruptcy process runs smoothly and that you are aware of any pitfalls before filing and during your bankruptcy proceeding.
If or not bankruptcy is the right option for you is a serious decision to make. Seeking the counsel of a lawyer who concentrates on personal finance is a good step in determining your future.