Is Bankruptcy Right for Me?
Weighing the Pros and Cons of Filing for Bankruptcy
In the wake of our country's economic downturn, millions have found
themselves faced with the question, "Is bankruptcy right for me?"
While this process is one of the most practical ways to find relief from
overwhelming debt, it is important to understand that the answer to this
question is not always so black and white. One of the most obvious benefits
of a successful bankruptcy is the court-ordered discharge of debt, as
this would free you of the legal obligation to repay your creditors.
In some cases, this may be reason enough to file a petition with the court.
In others, however, the negative ramifications may outweigh the numerous
advantages. For this reason, the legal team at Hensel Law Office, PLLC
encourages you to weigh your options under the advisement of a Michigan
bankruptcy lawyer before you make a final decision.
What are some of the potential advantages of filing?
If you have considered filing for
bankruptcy in Michigan, it is important to understand how it could benefit you short-term
and long-term. In most cases, this process will serve as a practical means
of freeing yourself from unmanageable debt. While this is an enormous
advantage in it of itself, there are numerous other
benefits to be gained, as well. Some of these may include:
- Fighting repossession, home foreclosure and wage garnishment
- Stopping all contact from creditors and debt collection agencies
- Moving on from the bankruptcy process with a fresh start
Since the court will order an automatic stay as soon as you have filed
your bankruptcy petition, you can expect to find relief from
creditor harassment and all further collection efforts as soon as you have initiated the process.
This means that you would be able to work toward a more viable financial
future without the added stress of impending
foreclosure, repossession or wage garnishment.
What are some the negative consequences of filing?
As you may know, there are both pros and cons to filing for bankruptcy.
While the advantages often outweigh the consequences, it is still important
to understand how the negative implications of filing for bankruptcy could
affect your life. For example, one of the biggest deterrents is the fact
that the bankruptcy would stay on your credit report for seven to ten
years after filing. This may subsequently cause your credit score to take
a significant dip.
Even so, you must realize that the damage does not have to be permanent.
By taking proactive measures to
restore your credit score immediately after the bankruptcy process has been concluded, you can expect
it to rebound within a matter of a few years. For this reason, it is highly
recommended that you discuss this aspect of bankruptcy with our firm before
disregarding the option of filing completely.
Choosing Between Chapter 7 and Chapter 13 Bankruptcy
Another factor that you will need to take into consideration when making
this decision is whether you would file under Chapter 7 or Chapter 13
of the U.S. Bankruptcy Code. While both were designed to provide consumers
with a way of finding relief from unmanageable debt, it is important to
understand that these processes are actually quite different.
Chapter 7 is an expedited process that would allow you to liquidate non-exempt assets
and use the proceeds to repay creditors.
All in all, you could expect the process to last a few short months. When
Chapter 13, however, you would be required to reorganize your debts and develop a
repayment plan that would be executed over three to five years. This form
of bankruptcy is meant to provide more gradual relief, as not everyone
would be eligible to file under Chapter 7.
Call Our Firm Today for a Free Consultation
If you are struggling with the decision of whether or not to file for bankruptcy,
we encourage you to place your trust in the hands of a Michigan bankruptcy
attorney today. When you turn to the Hensel Law Office, PLLC for guidance,
you can expect straight-forward answers to any of the difficult questions
that you may have. Additionally, it won't cost you a thing to seek
out our advice. All you have to do is call today at (888) 258-0651 to
take advantage of a
free initial consultation. From there, our knowledgeable legal team will have the opportunity to
review your case and provide you with the honest and caring advice that