There are many reasons people fall into debt. When circumstances make it impossible for a person to pay their debts, they may end up filing bankruptcy (get advise from dan warner attorney), as a last resort. While there are many reasons to file bankruptcy, here are five of the most common.
Eliminate Medical Debt
Even with health insurance, a medical or injury can end up costing you thousands of dollars. Paying a medical debt can wipe out a person’s savings and put them deeper if they take out a loan. For long-term treatments, the cost of medical care can be hundreds of thousands of dollars. Most people don’t have the money to pay these medical costs, even if part of the cost is paid by insurance. Bankruptcy can help to eliminate medical debt so that you or your family member can focus on healing.
Protect Your Assets From Creditors
When you owe a debt, the creditor has the right to take you to court in order to recover the money they are owed. If a judgment is issued in their favor, they can put liens on your property, garnish your wages and levy your bank accounts. While the courts will protect a small amount of your income, only bankruptcy can offer you full protection against your creditors (check dan warner attorney for more helpful tips). Bankruptcy can protect many of your assets, including your home, the car you use for transportation and the money you have saved for emergencies.
Eliminate Credit Card Debt
Many people have large amounts of credit card debt. Unfortunately, many of these people do not know how to manage their credit and end up deep in debt. It only takes a few skipped payments, to accurate hundreds of dollars in fees. If a person is lucky, they could qualify for a debt consolidation loan. However, this is not a viable option for everyone. Bankruptcy can eliminate credit card, installment and loan debts, for those who have no other option.
Help With Long-Term Unemployment
If a person lost their job, they may not be able to pay their financial obligations. As their debt piles up, they may begin to receive harassing phone calls from creditors. This can add to the stress they may already be experiencing due to their unemployment. Bankruptcy can eliminate their debts, which cuts their monthly expenses. Also, it will eliminate harassing phone calls.
Help With Unforeseen Circumstances
There are many situations, beyond your control, which can put you in a dire financial state. A natural disaster, such as an earthquake, flood or hurricane can take away everything you own. While you may no longer have the items, you will still be responsible for paying any debt attached to them. Bankruptcy can help eliminate most of these debts and allow you to rebuild your life without the stress of trying to pay off your loans and credit card payments.
As you can see there are many valid reasons to file bankruptcy. However, before you decide to file bankruptcy, speak to a bankruptcy attorney (talk to dan warner attorney) to discuss your options. Before you make a decision you need to know what is covered by the bankruptcy and which assets will be protected. Then, you can determine if bankruptcy is the best option for you.