If you’re facing debt problems, filing for bankruptcy can be a solution. Before you file, you should seek advice from a bankruptcy attorney so you can understand all your options. Today, Groce & DeArmon provide a summary of what bankruptcy can do for you.
Provide Debt Relief
First, bankruptcy can eliminate most types of debt, and this is the reason why most people file. Receiving a bankruptcy discharge means that you, the debtor, are no longer required to pay any debts that are dismissed. Certain types of discharged debt may include medical bills, personal loans, and credit card debt. However, bankruptcy doesn’t solve all debt problems. For more questions about debt relief, consult our bankruptcy attorneys.
Stop Collection Activities
Once you file for bankruptcy, the automatic stay goes into effect. It’s a powerful court order that prohibits most creditors from pursuing collection activities against you. When the automatic stay is in place, creditors cannot garnish your wages, foreclose on or repossess your property, or send you collection letters. They also can’t sue you. There are some exceptions to the automatic stay, though, and our bankruptcy attorneys can explain more during your free consultation.
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Avoid Foreclosure or Repossession
Bankruptcy’s automatic stay can stop the foreclosure or repossession process and give you time to confer with the lender. It can also temporarily stop the eviction process. If you can’t bring your account current, you’ll lose the car or house as soon as the stay lifts. In some situations, Chapter 13 bankruptcy allows more time to get caught up on past payments so you can preserve the asset.
Reorganize Your Debts
Chapter 13 bankruptcy allows you to restructure your debts and catch up on missed car loans or mortgage payments. You can pay off nondischargeable debts, like alimony and child support, through a repayment plan, which usually lasts 3-5 years. As long as you make your plan payments, the automatic stay prevents your lender from foreclosing on or repossessing your home.
Related Post: The Pros and Cons of Filing for Chapter 13 Bankruptcy
Get Help From an Experienced Bankruptcy Attorney
Shari K. (Groce) DeArmon has provided legal representation in Springfield, Missouri for nearly 30 years. If you’re seeking professional, personal, and friendly legal representation, contact Groce & DeArmon to schedule a free consultation. You can call us directly at (417) 862-3706.