What Are The Top Misconceptions That People Have About Filing Bankruptcy?
Prior to filing for bankruptcy, it is sensible to evaluate whether you can accomplish the same goal without going through a bankruptcy by working with your creditors or taking advantage of some other avenues. Bankruptcy should be a last resort. However, a common misconception about bankruptcy is that you’re some kind of a failure if you file for it, but in reality, a bankruptcy is designed to give people a fresh start. Many who file for bankruptcy do so because they are going through bad times, such as amassing outstanding medical bills due to a serious injury, illness, loss of a job, or having a dependent with health issues. Any number of things can cause people to need a fresh start. Oftentimes, a bankruptcy can help rebuild your credit by allowing you to have a fresh start. You can go on with your life and be successful after going through a bankruptcy.
What Are The Most Common Reasons People May Have To File For Bankruptcy?
The most common reasons people file for bankruptcy include a medical emergency has caused the enormous debt, loss of a job, and the inability to get reemployed. A great number of people are unemployed now due to the pandemic and the resulting economic depression. Many people will not be able to become reemployed, or they may have to accept jobs that pay far less than what they had been receiving. These conditions may force people to consider bankruptcy.
How Do You Determine If Filing Bankruptcy Is The Right Solution For Your Clients’ Problems?
We first want to make sure that bankruptcy is the last resort. We want to explore whether there are other avenues that exist to stave off bankruptcy while still accomplishing the same goals. If there is a solution in which you can pay creditors less or get extensions from creditors to pay over a longer time, then we recommend those options. Currently, there are other options to explore before going through bankruptcy, such as PPP loans, other types of loans, and government assistance available through COVID relief packages that are designed to assist people to get through this pandemic.
We will also look at your entire financial circumstances, such as the sort of income you anticipate receiving over the next several months, the total amount of your debts, and the nature of your creditors. We will assess whether some of your creditors are willing to forbear and give you additional time to pay off your debt.
What Do I Need To Do Before I File For Bankruptcy?
The decision whether to file for bankruptcy should not be made without the assistance of a bankruptcy attorney. After exploring your entire financial circumstances with your lawyer, your lawyer will advise you whether bankruptcy is the only viable route. If that is the case, then you will need to gather all your financial documents, have a good handle on what your assets and debts are, and complete the means test. You’re going to have to take the course that’s required by all debtors. You have to make sure that you have not incurred debts that are not dischargeable in the 90 days before you file. There’s a lot of planning that goes into a bankruptcy before you file.
It’s important to talk to a lawyer sooner rather than later so that you’re not at the point where it’s an emergency. By consulting a lawyer, you will be able to plan ahead and determine whether there are other options that avoid bankruptcy altogether or find a more beneficial avenue that solves your financial dilemma.
What Are Some Things I Should Not Do Before Filing For Bankruptcy?
Prior to filing for bankruptcy, you should not spend money on things that are extravagant such as jewelry, go on an expensive vacation, gamble, pay the debt owed to family members, or transfer assets without consideration.
For more information on Misconceptions About Filing For Bankruptcy, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (954) 900-9575 today.