Pros And Cons of Filing For Bankruptcy

Since many people do not actually know that they qualify for personal bankruptcy, they stay devoid of the benefits filing for bankruptcy can bring for them.While it is true that filing for bankruptcy can affect your personal finances for a long time, doing this might be the only viable option you have in certain circumstances.

However, deciding when and how to file for the right type of bankruptcy can be a complex process. That is because you do not have any experience of filing for bankruptcy. That is why you should always hire a bankruptcy lawyer for cases like these. A good lawyer can provide you with a guide to declaring personal bankruptcy.

Let’s consider a few pros and cons of filing for bankruptcy.

You’re Protected Against Creditors

As soon as you file for bankruptcy, The judge handling your case issues a legal stay preventing any debt collection activity from your creditors. Keep in mind that this does not read you of any debt, but stops the debt collection activity unless your case is resolved, or the stay is lifted.

This is one of the best reasons why you should file for bankruptcy as soon as you find out that there are no better alternatives available to you.

This Can Help Discharge Debts

If you are successful in your bankruptcy case, the judge will discharge some or all of the debt you have. That means you do not have to repay any of the discharged debt.

However, keep in mind that not every type of debt is dischargeable. Only the dischargeable debts will be removed, and you will have to repay the other types of debt.

No matter how beneficial it might seem to be, you should always be cautious when filing for bankruptcy.