Bankruptcy is a legal process in which a judge and a court trustee review the assets and liabilities of people, partnerships, and businesses whose debts have grown too large for them to pay. But before filing it’s better to have a bankruptcy attorney in Victorville on your behalf.
The court decides whether the debts are discharged, which means that people who owe them are no longer legally obligated to pay them. The court may also dismiss the action if the person or business has sufficient assets to pay its debts.
Bankruptcy rules were created to allow people to restart their lives after their finances had failed. Whether the collapse was caused by poor actions or bad luck, politicians may recognize that a second chance is a critical safety net in a capitalist economy.
The good news for anyone who is on the fence about filing for bankruptcy is that practically everyone who does so gets a second shot.
Who Files for Bankruptcy?
Most people and businesses who file for bankruptcy owe significantly more money than they have, and this situation is unlikely to change very soon. Bankruptcy filers owed $86 billion and had $56 billion in assets in 2020. The majority of such assets were real estate holdings, the value of which is up for debate.
When you have enough money to pay off your debts but need to alter the conditions, bankruptcy can be a useful financial planning tool. This is common in situations where people must settle mortgage arrears or taxes in a structured manner.
What’s shocking is that its individuals, not businesses, that file for bankruptcy the most. They owe money on their house, credit cards, and other debts.
They owe money on a mortgage, credit card debt, vehicle loan, or school loan — possibly all four! – and don’t have the money to pay it off.
Another surprise is that the majority of those declaring bankruptcy were not wealthy. The typical income for those who filed for Chapter 7 bankruptcy was just over $50,000.
Should I File for Bankruptcy?
“Should I file for bankruptcy?” you may wonder. Consider carefully whether you could pay off your loans in fewer than five years. If the answer is no, you may need to file for bankruptcy. It will be secure for you to have the assistance of bankruptcy attorney Victorville.
The idea is that the bankruptcy code was created to give people a second opportunity, not to penalize them for the rest of their lives. If you’ve been financially destroyed by a mix of terrible luck and bad decisions, and you don’t anticipate that reversing in the next five years, bankruptcy may be your only option.
There is still hope for debt relief even if you do not qualify for bankruptcy. A debt management program, a debt consolidation loan, or debt settlement are all viable options.
Each of these options normally takes 3-5 years to complete, and none of them assures that all of your debts will be paid off when you’re done.
The length of a Chapter 7 bankruptcy should not be a deciding factor; the process takes only 4-6 months. It’s important to realize that bankruptcy has substantial long-term consequences. It stays on your credit report for 7-10 years, making it harder to obtain loans in the future. For more details and to know the related matters thoroughly hire a bankruptcy attorney in Victorville
On the other hand, when all of your debts are paid off and you’re given a fresh start, you’ll feel a lot better mentally and emotionally.
Why Should You File For Bankruptcy?
The most obvious reason for declaring bankruptcy is that you are drowning financially.
No one will throw you a lifeline — not banks, not online lenders, not family or friends.
Because of bankruptcy, millions of people who lost their jobs or enterprises due to the coronavirus have some hope. They still had debts to pay, and many of them were insolvent. That is precisely what bankruptcy was designed to remedy. There will be no bailout. It was intended to help people get back on their feet financially and regain their mental health.
If your debts have increased to levels that your income can no longer support, filing for bankruptcy with the help of a bankruptcy attorney in Victorville is a safe, legal, and practical option.