There are countless myths associated with filing for bankruptcy and there are certain consequences that you need to consider throughout the filing process. Although there are some consequences that are considered to be negative, certain consequences can also be quite positive. Speaking to a bankruptcy lawyer will help to make sure that you can prepare for upcoming consequences as they approach. Here are some of the consequences that you can expect:
Personal discharge: if you have had creditors hounding you to repay your debts it’s quite possible that with a personal discharge you can have your creditors discharge a portion or the full debt from your record. Although there are some debts that cannot be discharged such as liens on your home, it is possible to make sure that you can forgive a large portion of your debt.
Automatic stay: if creditors have been automatically withdrawing from your account, writing you collection letters, suing you and more, an automatic stay on your account will make sure that creditors can drop debt collection over time.
Credit score: changes in your credit score will happen as a result the bankruptcy filing. In some cases your credit score can improve but even if it does take a hit, it’s important to remember that you can work at rebuilding your credit over time.
Privacy: filing for bankruptcy is not a private affair and almost any other creditor will be able to tell that you filed for bankruptcy for at least 10 years. The lack of privacy is often one of the reasons that people are quite hesitant to file for bankruptcy. Although it’s not reported in the news, if anyone wanted to see if you had filed for bankruptcy from a credit perspective, it is easy to check especially if it’s been within 10 years.
Keep some of these consequences in mind if you are considering filing for bankruptcy. Remember that working with a bankruptcy lawyer can be a great way to improve the bankruptcy process.
This post was written by Trey Wright, a bankruptcy lawyer in Tallahassee. Trey is one of the founding partners of Bruner Wright, P.A. Attorneys at Law, which specializes in areas related to bankruptcy law, estate planning, and business litigation.