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Why bankruptcy might be the most responsible choice

Declaring bankruptcy has gotten a bad reputation in recent years as a way for people who have spent too much to get out of their debt. While it is certainly true sometimes that individuals borrow too much to spend on non-essential expenses and wind up having to declare bankruptcy, it is more often a matter of having lost a job or other source of income that makes it hard to pay even the most basic bills. When this situation arises, declaring bankruptcy is actually often the most responsible choice since it puts creditors on notice of the issue and helps create a plan to pay back portions of debt that are more manageable.

This solution is by far better than simply continuing to allow accounts to go into delinquency, during which time creditors can charge interest and penalties and in some cases garnish wages or repossess a car or home. Those types of incidents can have a negative impact not only on the borrower but on their long term financial health and on the stability and wellbeing of their family.

One of the big advantages to filing bankruptcy is that collections stop. This helps to reduce the stress that is on a borrower and their family and makes it easier to regroup and figure out the best plan. Chapter 7 bankruptcy allows a borrower to discharge much of their debt while retaining some types of property and selling others. Alternatively, Chapter 13 bankruptcy is more like a consolidated loan with a gradual repayment plan based on a realistic evaluation of income and assets.

Source: CNBC, “The good thing about bankruptcy,” Sakina Spruell, Oct. 21, 2013.

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    Posted by MaryDecember 11, 2015

    "I am overwhelmed by your response to my call, even 10 years after my bankruptcy was discharged. You have more knowledge and expertise than I could have imagined. Because of you, my fears have been put to rest. For that, I'm so very grateful. Thank you many times over. "

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    Posted by ClientOctober 26, 2010

    "... I was extremely impressed with Charles' understanding of the bankruptcy laws to the extent that I felt certain that my best interests were always at the forefront. "

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    Posted by MarleneJanuary 8, 2014

    He helped me thru my 1st bankruptcy and now the second. I had no idea what to expect , but they kept me informed and answered all my questions. Mr. Schneider is the most experienced and knowledgeable lawyer I have ever met. If you have to file call this attorney first!

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