September 3, 2022
Bankruptcy may be viewed negatively, but it’s a resource that can be used to make people’s life more manageable financially. Some people may frown upon those who need to file for bankruptcy, but at the end of the day it is the debtor’s state of being that is most important. Being constantly run down by financial problems may cause someone to seriously assess whether bankruptcy is right for them. For those who are curious, here are a few bankruptcy secrets revealed.
Most people can keep their property and belongings.
As a Chicago bankruptcy lawyer residents depend on from Therman Law Offices, LTD can attest, some bankruptcy chapters enable debtors to keep their furniture, vehicles, home, appliances, and other essentials. There are limits to what you can keep, and the rules vary by state law, but many people are under no obligation to give up any belongings or property. It is the credit industry that instills fear in us that we’ll lose our property. And while that may be true in some cases, those who file for bankruptcy may be protected from losing their tangible assets.
You don’t have to have zero money in the bank to file.
It is a common assumption that bankruptcy is only for when you run out of money completely, but that is not the case. You can be someone who is employed, has a bank account, and owns property (up to specific limits from the date you file your case). After you file, an automatic stay goes into effect. This means that creditors are no longer permitted to contact you about debts. Many debtors find this provides them immediate relief, and a chance to review their finances without added pressure from relentless debt collection agencies.
Your finances will get better sooner than you think.
The purpose of bankruptcy is to get someone out of debt, not be used as a means to get back into debt. Your credit score may be impacted, even more so if it is currently at a higher standing. And you will get a mark on your credit report for the bankruptcy. However, before you know it your credit will gain in strength and you will be receiving credit card offers again. Be sure to give yourself tools to avoid getting back into debt shortly after filing for bankruptcy. You are only able to file for bankruptcy a limited number of times throughout a set period. By using bankruptcy strategically, your finances can get better sooner than you think.
You are not alone in what you are going through.
The bankruptcy court does not contact your employer or other people who know you about the bankruptcy filing. The payroll department may be notified to stop a garnishment, but they don’t usually explain as to the reason why. While bankruptcy court cases are public record, and someone could visit the courthouse to find out, but rarely is this the case unless the debtor is under scrutiny from the public or other parties. You are not alone in needing to file for bankruptcy. There are many big companies and famous individuals who have needed this resource. Do not judge yourself, and the fact that you are even looking into options is a success in itself.