Benefits of Bankruptcy
Legal guidance from bankruptcy lawyers to help you make the right decisions
Deciding whether to file for bankruptcy involves weighing the pros and cons. It involves making important decisions. The best way to do this is under the guidance of a bankruptcy lawyer. If bankruptcy will not resolve your debt, then it may not be the right financial remedy. At the Law Office of Robert A. Siegel, P.A., I personally work with clients to help them effectively handle financial problems and make decisions about bankruptcy.
Bankruptcy benefits people in a number of ways, including the following:
- Chapter 7 is a fast way to get rid of many debts, often within three to six months, although you may give up some property.
- Chapter 7 generally wipes out credit card debt. The trustee uses the asset liquidation proceeds to pay creditors, and the bankruptcy judge discharges remaining debt.
- Chapter 13 can help you preserve assets and buys time to pay off creditors, often at reduced debt amounts.
- Bankruptcy stops creditors from collection actions. After you file for bankruptcy, a court order called an automatic stay goes into effect, which prohibits creditors from calling or taking legal action, such as repossession and wage garnishment.
- Bankruptcy can often delay or help you avoid foreclosure. After the automatic stay goes into effect, lenders must enter a motion to lift the stay and wait for the court’s response. Courts frequently grant motions to lift stays, but this process may take awhile. If filing for Chapter 13, you may be able to stop a bank from initiating foreclosure and re-organize your finances so you can save your home.
- Eliminate second or third mortgages through Chapter 13. During bankruptcy, the courts classify second and third mortgages as unsecured debt, which takes last priority in a Chapter 13. Debtors frequently do not pay unsecured debt in this type of bankruptcy.
- You can often discharge tax debt that is more than three years old, provided that you filed tax returns at least two years prior to filing for bankruptcy.
Find out how we can help
I have helped many people get out of debt. For a free initial consultation to discuss bankruptcy, contact the Law Office of Robert A. Siegel, P.A. online, or call 410-609-3188.