Benefits of Filing for Bankruptcy

Struggling with debt can produce significant anxiety, and it can be difficult to know whether you are making the right choices when it comes to your finances, the economic needs of yourself and your family, and your credit score. Missing payments on credit card debt or medical bills can result in penalties and fees being added onto the total amount you owe, not to mention interest. If you do owe a substantial amount of consumer debt, you may be wondering whether personal bankruptcy is the right choice for you. There are many benefits to both Chapter 7 bankruptcy and Chapter 13 bankruptcy, which are the two most common forms of consumer bankruptcy in the U.S. The following are some of the benefits that come with filing for bankruptcy protection.

Automatic Stay Will Prevent Additional Actions from Creditors or Debt Collectors
Whether you file for Chapter 7 or Chapter 13 bankruptcy, one of the immediate benefits is that the automatic stay will prevent creditors or debt collectors from taking any additional actions against you to collect on the debts you may owe. The automatic stay prevents creditors and debt collectors from garnishing your wages or your bank account, and filing any type of claim against you in court or moving forward with a claim that has already been filed. The automatic stay even prohibits creditors or debt collectors from continuing to call you to try to collect the debt you owe.

Once you file for bankruptcy, you have these protections. If a creditor or debt collector does take any kind of action at all to move forward with the process of collecting a debt, it is important to seek advice from a bankruptcy lawyer in Oak Park about holding that creditor or debt collector accountable.

You May be Eligible to Have All of Your Debts Discharged
While not all types of debts are eligible to be discharged in a consumer bankruptcy case, many of the common types of debts that afflict consumers are indeed eligible for discharge. For example, credit card debt and medical debt—two of the most common types of debt in this country—can be discharged in a bankruptcy case. Although it can be more difficult to discharge student loan debt in a bankruptcy case, it is important to know that it is possible to have student loan debt discharged through bankruptcy in many types of cases. Your bankruptcy lawyer can discuss your options with you. When your debts are discharged, you will get a clean start financially.

You May be Able to Stop a Foreclosure on Your Home
If you file for Chapter 13 bankruptcy, the automatic stay can prevent a mortgage servicer or bank from taking any additional foreclosure actions, and you can actually stop the foreclosure and stay in your home. Since Chapter 13 bankruptcy is a reorganization bankruptcy, the automatic stay prevents the foreclosure action, then the bankruptcy repayment plan allows the homeowner to get back on track with mortgage payments.

Contact an Experienced Oak Park Consumer Bankruptcy Attorney for More Information
Are you considering bankruptcy? An Oak Park consumer bankruptcy lawyer can discuss the benefits with you today. Contact the Emerson Law Firm for more information about how we can help with your case.


See Related Blog Posts:
Can a Debt Collector Take My Stimulus Payment?
What Can I Do About Medical Debt Collection During the Pandemic?

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