Why Would Someone In Debt File For Bankruptcy?
One unfortunate fact about the state of our country is that debt is so common these days that it has become normalized. Consumer debt was already at over $14 trillion nationwide by November of last year with Americans carrying an average personal debt of $92,727. This overall debt figure includes credit card balances, student loans, and mortgages in addition to debt from other sources. And while debt levels can fluctuate across the country due to cost of living variations, nationwide the average debt tends to peak between age 40 and 49 although the generations both before and after this age range are also carrying substantial financial obligations. The fact that debt is viewed as essentially normal these days does not mean that incurring it comes without consequences. People who find themselves under debt that there seems to be no escape from may be surprised to find themselves turning to a solution they previously discounted – bankruptcy.
The Benefits of Bankruptcy
The bankruptcy process tends to get a bad reputation and carries a social stigma which is understandable to a certain extent. The fact of the matter is that declaring bankruptcy can (temporarily) have a huge impact on your credit score which can in turn affect your ability to make certain purchases or even qualify for certain jobs. The bankruptcy process itself can also be expensive, require a substantial amount of paperwork, and move slower than you would ideally like it to. However, none of this changes the fact that bankruptcy can in fact be helpful in a number of ways depending on your financial situation. After all, bankruptcy is a unique legal process which ultimately offers financial relief and an opportunity to reset credit for those who have found themselves unable to pay off their debts.
How Does Bankruptcy Work?
In some cases, bankruptcy completely wipes out unpaid bills and allows borrowers to eliminate their debts altogether. In other situations, borrowers are able to restructure when and what they have to repay. Filing for bankruptcy also has unique advantages such as:
- Preventing creditors from wage garnishment and seizing personal assets
- Halting harassing phone calls and demand letters
- Ultimately allowing the borrower to overcome debt which studies show can greatly improve overall happiness
Depend on Us for Advice and Solutions
If you are drowning in debt with no solution in sight, you have likely already considered declaring bankruptcy. However, understanding this complicated legal process and whether it is in fact your best option can be extremely difficult without the right legal help. As the Plantation bankruptcy attorneys at Nowack & Olson, PLLC, we are committed to helping those suffering under debilitating debt regain control of their lives and live without constant financial worries. In addition to simplifying things to help you understand your choices and rights, we can also advise you on how you should proceed with every step throughout this process. The initial consultation is free and comes without obligation so you should not hesitate to contact us today about moving forward toward a better financial future.
Resource:
bankrate.com/personal-finance/debt/average-american-debt/
