Millions of Americans who are in financial distress may be able to benefit from filing for bankruptcy. While a bankruptcy may stay on your credit report for up to 10 years, in many cases this is a better alternative than continuing to ignore debts that will simply accrue over time and continue to ruin your credit. It is a common misconception that it is difficult or impossible to obtain financing after filing for bankruptcy. In fact, some people actually have better credit shortly after filing for bankruptcy than they did prior to filing. Of course, it is important to discuss your options with an experienced bankruptcy lawyer prior to making any decisions or filing any paperwork with the court.
Bankruptcy can have many benefits, some of which occur the moment a person files. Some of the more apparent benefits of filing for bankruptcy are detailed below:
The Automatic Stay – The automatic stay1 is an injunction that is automatically imposed the moment a person files for bankruptcy. It prevents creditors from attempting to collect on a debt in any way, including calling you, sending you letters, repossessing or foreclosing on property, or filing a lawsuit against you. In many cases, this period of protection gives debtors an opportunity to make alternative arrangements with certain creditors that may have a security interest in a piece of property that a debtor would like to keep.
The Discharge of Debts – One of the main benefits of filing for bankruptcy is the discharge2 of debt. When a debt is discharged, it means that the debtor is no longer under any legal obligation to pay it back. Some of the kinds of debts that are often discharged in bankruptcy include:
Debt Reorganization – In Chapter 13 bankruptcy, people who have a consistent monthly income can reorganize their debts in such a way as to keep paying a consolidated monthly payment that is distributed among their creditors while keeping their property. In many cases, Chapter 13 can help people keep their homes, businesses, or other important assets.
Contact a Long Island bankruptcy attorney to schedule a free consultation
If you are experiencing financial problems, you should explore whether you could benefit from filing for bankruptcy. To schedule a free consultation with Long Island lawyer Ronald D. Weiss, call our office today at (631) 402-5967.