Why You Should Not Fear Consumer Bankruptcy

During this time of economic downturn and massive unemployment, many Oak Park, IL residents and Americans across the country are wondering if consumer bankruptcy is the right choice for them. Yet, as a recent article in NerdWallet underscores, debtors everywhere often fear bankruptcy, and it can prevent those debtors from seeking the relief they need to move forward. As that article underscores, there are so many myths about bankruptcy that drive debtors’ fears and worries about filing for bankruptcy, when Chapter 7 or Chapter 13 bankruptcy could benefit individuals and families who are struggling with debt. The following are just some of the reasons that you should not fear bankruptcy and should get in touch with an Oak Park bankruptcy attorney to learn more about your options for filing.

You Should Know That You Will Not Lose All of Your Property

If you are considering Chapter 7 bankruptcy, which is a form of liquidation bankruptcy, you should know that all of your assets will not be liquidated. According to Illinois’s bankruptcy exemptions, a wide variety of assets will be exempt, from personal property and equity in your home to pensions and other retirement accounts. You should speak with a bankruptcy lawyer about the specific exemptions that will apply in your case.

If you are planning to file for Chapter 13 bankruptcy, your property will not be liquidated at all. Instead, since this is a type of reorganization bankruptcy, you will develop a repayment plan that lasts for anywhere from around three to five years, and in that time you will repay a certain amount of debt on your non-exempt assets. Once the repayment plan period is over, remaining debts will be eligible for discharge, and you will still have your property.

Rebuilding Your Credit Takes Less Time Than You Might Think

Although your bankruptcy will be on your credit report for 10 years, you should absolutely know that you will not have to wait 10 years before you are eligible for credit again. As soon as you receive your bankruptcy discharge, you can begin rebuilding your credit. Within two years of your bankruptcy filing, you can be eligible for an FHA or a VA loan for a mortgage. After four years, you may even be eligible for a conventional mortgage.

If you go into the bankruptcy process understanding that this is not a death sentence for your credit profile but rather a way to seek relief from debt, and ultimately to get a fresh start, you will be much better off in the long run.

Fears Surrounding Debt Often are Much Worse Than Bankruptcy

While many people fear bankruptcy, it is important to highlight the fears and anxieties that accompany substantial consumer debt. Having debt that you cannot repay, and for which you cannot imagine a path toward repayment in the future, can result in significant worry and anxiety. By looking into your options for personal bankruptcy, you can help to relieve some of that fear and anxiety with a process designed for debtors like you.

Contact an Oak Park Consumer Bankruptcy Lawyer

Do you need assistance with a consumer bankruptcy case? Our Oak Park bankruptcy attorneys can speak with you. Contact the Emerson Law Firm today.



See Related Blog Posts:

Federal Crackdown on Abusive Debt Collection

Why Was My Bankruptcy Discharge Denied?

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