For many, filing for bankruptcy can seem like a sign of complete financial ruin. This pervasive idea should come as no surprise since filing for bankruptcy continues to carry with it a negative connotation. This idea persists even though, in 2016, almost 800,000 individuals filed for bankruptcy in the United States, and filing is a completely legal way for people to obtain a fresh financial start.
Bankruptcy is not the last resort for individuals struggling to cope with debt. While filing for bankruptcy is not ideal, bankruptcy does provide filers with several benefits. In fact, individuals seeking to improve their financial situations should consider bankruptcy as an alternative that can help alleviate debt-related problems.
A debtor—the individual or business entity with outstanding debt obligations—must determine under which chapter of bankruptcy to file. Debtors should be aware that they must be eligible to file under a specific bankruptcy chapter, and also to take the time to determine which type of bankruptcy would most benefit them. For example, if an individual debtor wants to keep his or her home, Chapter 13 would likely be more appropriate than Chapter 7. On the other hand, if a business debtor wants to continue operating the business during bankruptcy, Chapter 11 may be worth considering. Because of these significant differences, it is important to speak to an attorney about your situation before filing.
How Does Bankruptcy Benefit Me?
Filing for bankruptcy is a major decision, and certain benefits of filing may not materialize for months or even years down the road. That said, some benefits of bankruptcy are apparent the moment that your case begins. Regardless of when you experience the full benefits of your decision, filing for bankruptcy is undoubtedly the first step to a better financial life and a fresh start for many debtors. Some benefits of bankruptcy include the following:
- Discharge of eligible debts. Debtors can receive a discharge of most unsecured debts. This helps reduce the debtor’s financial obligations, lifting a burden from the debtor’s shoulders.
- Automatic stay protection from creditors. An automatic stay is entered once a debtor files for bankruptcy. This helps to keep creditors from continually harassing the debtor for repayment.
- Keeping exempted assets. Certain property is off limits to creditors. Exempting certain property helps to keep debtors in their homes and off of the streets.
- Most importantly, bankruptcy provides debtors with an opportunity to have a fresh start.
CONTACT A SALT LAKE CITY BANKRUPTCY ATTORNEY TODAY
Filing for bankruptcy has both its pros and its cons. Therefore, debtors must take the time to learn how filing for bankruptcy can help their financial situation. At JLT Law, we have the experience, knowledge, and understanding of bankruptcy law to help you in your difficult time. We will sit down with you, evaluate your financial situation, and help you make the determination regarding bankruptcy that is right for you. Schedule your consultation by calling (801) 896-9444 today, or by sending us an email through our online contact form.