Top Reasons That People File for Bankruptcy

Getting sued by a creditor is one of the most humiliating things that can happen in a courtroom, but business to consumer lawsuits are unfortunately common in Florida.  Creditors can persuade the court to order you to pay debts that you cannot afford, and when you do not pay (as you have been saying all along that you cannot pay), the creditors can go back to court to seek a wage garnishment, where the creditors help themselves to a share of your already modest paycheck.  In the worst cases, the court can even subject you to a debtor’s exam, where the creditor’s lawyer asks you embarrassing questions about how little money you earn and every purchase you have made in the past few months that was not strictly necessary.  You can avoid all of these slights by being proactive and settling or renegotiating your debts before things get that bad.  You can also file for bankruptcy protection.  Unlike in a debt collection lawsuit, in a bankruptcy filing it is the borrower that is seeking the court’s help in shielding the borrower from abusive actions by creditors.  To find out more about filing for bankruptcy protection, contact a Plantation chapter 7 bankruptcy lawyer.

Most Common Reasons for Bankruptcy Filings

If you follow the legal requirements in your bankruptcy case, the court will accept your bankruptcy filing and discharge your eligible debts.  When bankruptcy cases get rejected, it is because of incomplete, incorrect, or false information on the documents, not because the debtor does not have a good enough reason for being broke.  It is not the court’s business to judge you for marrying a cheater or for buying too many pairs of shoes.  These are some of the most common reasons that people file for bankruptcy protection:

• Medical bills
• Job loss due to corporate layoffs
• Increased expenses or decreased income due to increased family caregiving obligations
• Divorce, with its residual debts and loss of a former spouse’s income
• Inability to recover from a previous financial setback due to job loss or unemployment, since your new job is not enough to pay old debts while also keeping up with current bills

Bankruptcy Filings Are About Discharging Your Debts, Not About Humiliating You for Incurring Them

From a legal perspective, there is no such thing as a bad reason for filing for bankruptcy protection.  Bankruptcy laws give everyone the right to discharge debts that they cannot pay, instead of having to face horrible consequences like debtors’ prison or having the debts passed down to subsequent generations.  Even though filing for bankruptcy protection is a right enjoyed by every person, people who file for bankruptcy must follow legal requirements, and a successful filing will not make all of your financial obligations disappear.  A bankruptcy lawyer can walk you through the process.

Work With a Debt Lawyer About Discharging Your Debts

A South Florida debt lawyer can help you decide whether filing for bankruptcy is right for you.  Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.

Source:

investopedia.com/financial-edge/0310/top-5-reasons-people-go-bankrupt.aspx