The Cook Law Firm

The unfortunate truth about bankruptcy is that many people don't understand what it does, who should consider filing it, and how it works.
In fact, the word has a negative connotation for many people.
While yes, the scenarios that lead people to needing bankruptcy are negative, bankruptcy itself is a good, positive thing that exists to provide a solution to those who don't have control over their debts.
Although different chapters of bankruptcy proceed in different ways, they both serve to discharge debts once the process is complete, and they both help you wipe your financial slate clean so you can reclaim your life.

When you're facing seemingly insurmountable debt and considering bankruptcy, you may be urged to file as quickly as possible to get the ball rolling.
However, the truth of the matter is that bankruptcy requires a considerable amount of planning to properly utilize the process and ensure that you're pursuing all of the options available to help you.
When it comes to housing in particular, it's imperative that you understand everything you have at your disposal to protect your home in both Chapter 7 and Chapter 13 bankruptcy.

During the bankruptcy process, there are a plethora of exemptions and conditions that can protect your property, ease the financial burden of bankruptcy, and more.
However, because every bankruptcy case is unique, these moving parts can be difficult to understand and apply to your situation.
Tax debt, for instance, is one of the more complicated forms of debt when undergoing bankruptcy.
While it can, in some cases, be discharged at the end of the process, the criteria to do so can be relatively complex.

While there is an unfortunate negative stigma surrounding bankruptcy, it's important to know that many people in trying financial situations could greatly benefit from the process.
For instance, if you're currently dealing with wage garnishments, bankruptcy could help you.
When you have outstanding debts, your employer can be court-ordered to withhold a certain percentage of your earnings to pay back creditors.
This won't happen without a formal hearing first where the creditor sues the loanee and wins the case.

Most people don't truly understand bankruptcy and how it can help when you're in debt with seemingly no way out.
In the grand scheme of things, it creates a plan to address your debts, pay them back, and give you a blank slate, all while giving you relief from debt collectors.
As a part of all bankruptcy Chapters, debts are stayed once the filing is successfully completed.
This means, very simply, that once you're going through the bankruptcy process, it's actually illegal for debt collectors to harass you for payments.