Declaring bankruptcy is an individual’s way to throw their hands up and gain a fresh financial start after they’ve become overwhelmed in debt. Thousands of Hyattsville residents declare bankruptcy every single year. Although bankruptcy seems like the end of the road to some people, it is actually the light at the end of the tunnel. Persons who file for bankruptcy protection in a Federal Court can overcome their debt and get back on the right road. But, the many benefits of bankruptcy don’t stop there. Read below to learn more about some of the many benefits of declaring bankruptcy and speak to a bankruptcy lawyer hyattsville without delay if this relief could be of help.
Bankruptcy isn’t perfect, but what is? There are obvious disadvantages that people who declare bankruptcy endure. For example, bankruptcy is placed on the credit report, where it is visible to anyone who pulls a copy of the record for the next 7 to 10 years. Despite the slight disadvantages, most people who are drowning in debt agree that bankruptcy is a viable solution for their needs.
An automatic stay is granted once a person files for bankruptcy protection. The automatic stay prevents creditors from further pursuing action against a debtor to collect the debt. Furthermore, the stay prevents creditors from repossessing property or from filing a lawsuit in a court of law. Creditors may not garnish wages or further contact a debtor once bankruptcy is declared. Many people use bankruptcy to prevent foreclosure or eviction, to prevent vehicle repossession, or to avoid wage garnishments or other troubles.
Depending on the type of bankruptcy filed, it may also clear off all of the debts owed, allowing the debtor to completely renew their slate and start over. Discharge of debts eliminates most debts from the credit report, although student loans, child support, and other government debts may not be discharged. Debtors may use the time period that bankruptcy remains on their record to reestablish themselves and their financial well-being.