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Bankruptcy Advantages Bankruptcy is a good choice to eliminate your debts when you cannot afford to pay your debts off because it’s like hitting the reset button and starting over financially. After filing for bankruptcy, all your credit history will restart, and if you have a vehicle or home loan that you keep through the bankruptcy, it will help you recover from your debt faster. The Court often refers to it as a “fresh start”.
There are several factors that determine whether you qualify for bankruptcy. One of these factors is your monthly income in proportion to your family size. Congress has designed a means test to determine whether an individual is qualified for a Chapter 7 bankruptcy. The court will examine your income, your housing costs, family size, and overall secured debt. If you do not qualify for a Chapter 7 bankruptcy, you may still qualify for a Chapter 13, as long as you don’t exceed the debt limits. Another way to qualify for bankruptcy is if your debts are non-consumer debts, such as student loans, income taxes, excise taxes, business debt, and more non-consumer debts, if the non-consumer debts exceed the consumer debts, then no means test is required.
Almost every client we have filed bankruptcy for has improved their credit score after filing for bankruptcy. If you can’t get a loan because you have too much credit card debt, filing bankruptcy will clear that data and will assist you in getting a loan in the future. Filing bankruptcy will clear your credit record and eliminate your debt. This will eventually boost your credit score, as it is heavily determined by a debt to income ratio.
If you are struggling to pay your credit card payments, or can’t afford to pay anything over the minimum payments, your debt will likely continue to rise, and filing for bankruptcy may be a good choice. If you look on the first page of your credit card bills, they state how many years it will take to pay off the credit card while making the minimum payment. Often this will let you know if bankruptcy is a good option for your situation.
There’s no need to feel guilty or ashamed when filing for bankruptcy. Many famous people such as Walt Disney have filed for bankruptcy. President Trump’s companies have filed for bankruptcy several times. Many creditors look at it as taking responsibility for your debts as opposed to just allowing all debts to default. In California, although bankruptcies are public record, they are not published in newspapers or other more easily-accessible media. Filing bankruptcy and becoming financially sound and productive is far better than suffering with out of control debt and not facing your situation.
For more information on Eliminating Your Debts In California, an initial consultation with an experienced California Bankruptcy Attorney is your next best step. Get the information and legal answers you are seeking by calling (916) 685-7878 today.
Mr. Cianchetta is an OUTSTANDING attorney. I was a little nervous about seeing an attorney for my case. Mr. Cianchetta and his staff made my wife and I feel right at ease. He took extra time explaining what to expect before, during and after our process. His advice was right on!
- Jack M.
