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With the current climate of the COVID-19 pandemic and the economic recession that is taking place, debt relief is necessary. Millions of people lost their jobs and filed for unemployment.  As a result, more and more people are living off credit cards and incurring massive debt, causing them to seek the aid of a bankruptcy attorney. This post focuses on 6 Reasons Bankruptcy May Be a Good Idea.

Fortunately, the government was able to step in and give citizens stimulus funds to counter the effects of the coronavirus pandemic.  In addition, citizens who filed for unemployment were also able to receive an additional $600 in addition to their employment benefits. All of this was done in an effort to help low-income to middle-income citizens bear the costs of living during this time.

Coronavirus debt and its implications for the future

Coronavirus-ImplicationsDespite stimulus aids, COVID-19 debt remains.  Prior to the pandemic, many were already been behind on debt obligations. The effects of COVID-19 simply worsened matters.  The economy took a terrible hit and jobs have left many unable to pay bills.  For the unfortunate individuals in this predicament, bankruptcy might be a good option for coronavirus debt relief.  After reading this article in its entirety, it is still advisable to consult with a bankruptcy attorney as an extra measure.

What exactly is bankruptcy?

Before embarking on this journey to find out whether bankruptcy is the right fit for you, it is important that you understand what exactly bankruptcy is. Some people may find that they don’t exactly know what bankruptcy is.  As a result, defining and understanding what the term bankruptcy is a good place to start. Simply put, bankruptcy is federal relief afforded to those who do not have the financial means to pay their debts. It is also important to know that there are different types of bankruptcies one can file. Two of them will be discussed in this article.

Are you still wondering whether filing for bankruptcy is a good decision? You have come to the right place.  Below are some of the reasons bankruptcy may be a good fit for you.  To learn more beyond this article, contact San Diego bankruptcy attorney Tristan Brown of T.L. Brown Law for a free consultation.

 

1. You are in extreme debt and have no way to pay it off.

Get a copy of your credit report.

If you happen to be in a lot of debt and you have absolutely no way to pay them off, then filing for bankruptcy might be a good option for you. While some people might think they are in extreme debt, it might not be enough to actually be able to file for bankruptcy. A good way to know if you are in extreme debt would be if it starts to affect your credit score and how badly. To know this, it is best to obtain your credit report.  Most of your debt obligations will be represented on your credit report.  Three major credit bureaus (Experian, Equifax, and Transunion) exist. One will be able to find out his or her debt obligations by a thorough examination of all 3 credit reports.

You are eligible for at least one free credit report per year. So, if you have not obtained your free credit report and are wondering what debts you may have incurred, you have one free report at your disposal. Get your free credit report and proceed from there.

Verify your debts.

Once you get your credit report and see what debts are listed, you should verify these debts by calling the creditors listed.  Errors on credit reports are possible, albeit rare.  Still, it’s a positive sign when you notice no negative reporting on your credit report. Make it a point to keep up with your credit history.  Also be sure to review your recent bills.  Be sure you have not received any debt collection letters that include additional debts not listed in your report.

If after verifying your debts they are overwhelming and you feel unable to pay them off, take a deep breath and continue reading.  When you have a steady income you can push through and eventually be able to pay off your debts without filing for bankruptcy.  You chances of successfully avoiding bankruptcy are increased with with great financial planning and budgeting.  Nevertheless, filing for bankruptcy might be beneficial for people who do not have a steady income.  A search for “bankruptcy attorney San Diego” will lead you to T.L. Brown Law, where you can receive additional information.

2. You’ve spoken to a bankruptcy attorney who determines you are eligible to file for Chapter 7 bankruptcy.

Knowing whether or not you are eligible to file for bankruptcy is the first and important step in deciding whether it is a good choice for you. There are different factors that go into determining eligibility for bankruptcy. One may or may not meet all these requirements.  Some of the factors that determine eligibility differ by state and should be dealt with on cases by case basis. The common way to determine if you’re eligible for Chapter 7 bankruptcy is if your current income is lower than the average income in your state based upon your household size.

A great way to know if you meet these requirements by the state is to consult a bankruptcy attorney near you. A quick way to find a bankruptcy attorney would be to search “bankruptcy attorney near me.” If you live in a large area (such as San Diego) and would like to explore your options, search “bankruptcy attorney san diego.”  Review your options and choose an experienced and affordable bankruptcy attorney.

Naturally, Some decide they can make do without consulting a bankruptcy attorney. You can go online and research the specific requirements for bankruptcy eligibility in your state.  It’s fairly simple to determine eligibility. However, if you get stuck, contact a bankruptcy lawyer.  Attorney Tristan Brown, offers free consultations and will be happy to answer any questions you have.

3. You are unemployed, laid-off, furloughed, or do not foresee additional cash flow the near future.

So many people worry a great deal about not having enough money to pay off debts.  However, there is a slight difference between being worried about not having money in the future and actually being broke. When you do not have the money to pay off your debts and are considering filing for bankruptcy, ask yourself some questions.  Do you foresee having the money in the near future? You may have a low paying job that doesn’t allow you to make debt payments. Do you foresee yourself getting a raise that will better enable you to pay your debts?  Are you able to get a second job to help pay the debts? Is there a promotion in your future?  Are your debt obligations going to lessen soon? If so, then you may be able to avoid bankruptcy.

You may ultimately decide you are comfortable skimming by until you get the additional income.  All of these factors and more are important to consider when making your choice.  A good bankruptcy attorney can help guide you.

Do you foresee yourself getting a raise in the near future?  Do you have the mental and physical capacity to take on another job? Then perhaps you would be better off not filing for bankruptcy.  Perhaps waiting for an increase in income is your best option.  “You can avoid bankruptcy if you’re expecting a promotion.  Working a second job helps too,” says San Diego bankruptcy attorney Tristan Brown. “When none of these apply to you, you may want to consider bankruptcy as an option.”

To learn more, enter “bankruptcy attorney San Diego” in your search engine and contact bankruptcy attorney Tristan Brown of San Diego, California.

4. Most of your debts would be forgiven by a Chapter 7 bankruptcy.

Chapter 7 bankruptcyThere are different types of bankruptcies, all of which serve different purposes. People typically file Chapter 7 bankruptcies or Chapter 13 bankruptcies, both of which serve different purposes. Generally a Chapter 13 bankruptcy filing will allow you to repay some of your debts using a repayment plan over the span of 3-5 years.  The length of the Chapter 13 repayment plan will depend upon the debtor’s income and the extent of the debt.

While the overall purpose of a Chapter 7 bankruptcy filing is to discharge your debts, a Chapter 7 bankruptcy does not discharge ALL of one’s debts; however most unsecured debts are dischargeable.  Unsecured debts are debts that do not require returning the purchased goods.  Unsecured debts include debts derived from credit card debt and medical debt.  On the contrary, secured debts include debts underlying goods purchased from jewelry stores and car dealers.

Domestic support debts, such as child support or alimony are not dischargeable.  Moreover, you generally cannot discharge student loan debt in bankruptcy.  Still unsure as to what categories your debts fall under?  Still confused as to whether the majority of your debt will be discharged in a Chapter 7 bankruptcy?  Get a free consultation with San Diego bankruptcy attorney Tristan Brown.

 

 

5. You’ve done your research, spoken to a bankruptcy attorney, and completely understand the implications of filing for Chapter 7 bankruptcy.

Filing for bankruptcy can have its benefits, such as erasing much of your debt.  Still, there are certain conditions that come with filing for bankruptcy. Prior to filing for bankruptcy, you must complete a counseling course. This courses can provide you with insight as to what you can expect in your bankruptcy.  The course serves as an additional resource for debtors looking to make an informed decision about filing for Chapter 7 or Chapter 13 bankruptcy. It is also important to note that once a bankruptcy filing is complete, there may be a bankruptcy notation on all your credit report.  Bankruptcy can stay on your credit report for up to ten years.

Do you accept all the conditions that come with filing for bankruptcy?  Perhaps Chapter 7 bankruptcy or Chapter 13 bankruptcy may be a good option for you.

It’s important that you talk to an experienced bankruptcy lawyer to ensure that you meet all requirements.  A simple search for  “bankruptcy lawyer San Diego” will lead you to bankruptcy attorney Tristan Brown of T.L. Brown Law.  Contact T.L. Brown Law for a free consultation.

6. You have absolutely no other choices but to file for bankruptcy.

You’ve met with a bankruptcy attorney to discuss your options.

Filing for bankruptcy often carries a negative stigma.  The negative impact on credit and credit reports makes bankruptcy a hard pill to swallow.  Do you meet the bankruptcy requirements and accept all of the conditions that come with filing? Perhaps bankruptcy is the best option for you.  However, prior to filing, you want to be completely sure that you’ve exhausted all available options.  Be certain there are no other measures you can take to alleviate the debt you have acquired. It is also a good rule of thumb to consult with an experienced bankruptcy lawyer. Take your time and pick the lawyer’s brain to learn what options you have at your disposal.  He or she might have other options outside of bankruptcy.

After you and the bankruptcy attorney discuss your options, you can feel comfortable knowing you thoroughly researched prior to making your decision.  Additionally, should you decide to file, you now have a helpful bankruptcy lawyer at your disposal.

Regardless of whether or not you end up filing for bankruptcy, it is always great to consult with a bankruptcy attorney. These professionals can present you with options that you probably will not find on online otherwise.  An experienced bankruptcy lawyer can provide you with additional tools needed in case you do end up filing for bankruptcy.  Furthermore, he or she might also be able to negotiate more advantageous outcomes for you.  After your bankruptcy, be sure to improve your financial management.  Your bankruptcy attorney might also be able to help you obtain a financial advisor.  A financial advisor can help you learn to manage your finances and engage in healthier debt management.

You’ve considered the negative repercussions to filing with the bankruptcy attorney.

Please note that filing for bankruptcy does not solve everything. Lenders and creditors may deny you future loans/credit due to bankruptcy’s negative impact on your credit report. Also, it will take considerable time to rebuild your credit.  Luckily, your bankruptcy attorney might be able to help take the appropriate steps to improve your credit score upon filing.

Please contact T.L. Brown Law Firm and speak to Tristan Brown, an experienced bankruptcy attorney in San Diego to learn more.

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