Wait, bankruptcy can be a good thing? You may not notice it when you are feeling miserable about losing everything, but, yes, bankruptcy can work in your favor. Find out how by reading ahead:
1. Your Debt will be Gone
Obviously, the most positive thing about bankruptcy is that you will no longer be forced to repay your debt. Chapter 7 bankruptcy completely eliminates unsecured debts. Most of the loans you can’t repay will be forgiven. You can also eliminate all credit card debt. Even legal fees are limited when you file for bankruptcy. The law has strict limits on how much your Atlanta bankruptcy lawyer can demand from you for a filing. So, even if bankruptcy proceedings are heart wrenching, it will take a load off your shoulders.
2. You Can Reclaim Your Home
Most people fear that they will lose the roof over their heads if they file for bankruptcy. Not exactly. If you file for Chapter 13 bankruptcy, your primary residence will be protected from foreclosure. The court can demand the creditor to allow you time to repay missed payments so you don’t end up homeless. In some cases, the court may eliminate home equity line of credit dues. Your right to shelter is given priority in bankruptcy proceedings.
3. Your Credit Score will Improve
Yes, your credit score will hit a low point at first once you file for bankruptcy. But, after about 12 months, your credit score will improve. Why? Simply because you no longer have creditors reporting missed payments to credit bureaus. As mentioned above, bankruptcy eliminates debt. When you are not in debt, credit scores do not go down. Bankruptcy itself hurts your credit score only once because you are not repeating it each month, unlike missed payments.
4. You will be Less Stressed
Once you have filed for bankruptcy, it becomes a done deal. The proceedings could be a bit stressful, but you will feel the relief once all the matters are sorted. You will notice that you no longer fight with your domestic partner over debt. You have both reconciled to file for bankruptcy and get it over with. You will now have a chance to repair your relationships, as well as your finances.
5. No More Collection Calls
Finally, you will not have to make up lame excuses when a collector calls. You will no longer look at your phone with a sinking feeling in your heart every time it rings. No one will harass you over debt, threaten to sue or hold back your wages now that you have filed for bankruptcy.
6. You will Learn Valuable Money Management Skills
Most people go into debt because they have terrible financial management skills. Bankruptcy, in this sense, can be like a valuable life lesson. People who have filed for bankruptcy have the opportunity to learn from their mistakes. Most emerge from bankruptcy with better knowledge of how to manage personal and business finances. You can, too, learn from your mistakes and manage your money better post- bankruptcy.
7. You Get the Chance to Start Fresh
Bankruptcy, rather than being the end, is a fresh start. Your old debts will be gone or sorted out by the courts. You will emerge with a nearly clean slate and the incredible opportunity to start fresh. If you have a steady income, bankruptcy will not be a black stain on your record. If you’re simply avoid making the same mistakes as before, you will be able to immensely improve your financial situation.
The point is, filing for bankruptcy is not the end of your life. You can bounce back from this and start over. Think of having to file for bankruptcy as a second chance. Instead of feeling down and low, bring yourself to see the positive and start rebuilding your financial life.