When is Bankruptcy the Best Option?

In today’s economic climate, many people have been finding themselves having serious financial difficulties. If you find yourself in a bad situation financially, you may be wondering if filing for bankruptcy may be the best option to get yourself out of it. While there are some situations that may warrant filing for bankruptcy, you need to understand that it is literally trading one set of financial problems for another. Filing for bankruptcy may benefit someone who is not able to meet their debt obligations and their living expenses at the same time. In any case, if it is at all possible bankruptcy should be avoided.

If you seek help for your financial problems with a financial debt counselor and it is determined that a bankruptcy is the best option for you, you would be wise to seek the help of a Metairie bankruptcy attorney. Going through a bankruptcy without an attorney could be disastrous for you financially. They will be able to explain to you what your rights are depending on what type of bankruptcy you would be filing for. In some cases, you may get to keep your property.

There are two types of bankruptcy that can be filed, chapter 7 and chapter 13. These bankruptcies are very different in nature and you need to fully understand what is involved with them before you decide to go ahead with either of them. It is strongly suggested that you consult a financial debt counselor and seek the assistance of a professional bankruptcy attorney in Metairie before going forward with either.

When you file for a chapter 7 bankruptcy, you are making the decision to sell everything that you own that is of value in order to settle and eliminate your unsecured debts with creditors. This is a very big decision depending on your situation. For instance, if you are married with children it will have a significant impact on the entire family for 10 years. In some cases, it could affect getting a new job or even renting a home.

With a chapter 13 bankruptcy, you ordinarily keep your possessions. However, you would have to reorganize your payments with your creditors. This is a debt repayment option, not an option to clear your debt. This type of bankruptcy would remain on your credit record for 7 years. You should consult a financial debt counselor before going ahead with either type of bankruptcy.

While filing for bankruptcy may clear most of your debts, you need to be aware that some debts cannot be eliminated by a bankruptcy. Some examples of such debts include guaranteed student loans, taxes and tax penalties among others. If you take the time to speak with a Metairie bankruptcy attorney, you will be able to find out where you stand legally.

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