If you are contemplating filing for bankruptcy but are overly concerned about what filing might do to your credit and your financial future, it's a good idea to consider what filing for bankruptcy CAN do for you. The top five reasons for filing Chapter 7 bankruptcy include:
1.You will experience immediate relief from the "Automatic Stay".
Are you sick and tired of those annoying collector calls that put you in constant fear of answering the phone to those unknown callers? Are you afraid of getting your mail because you might find yet another collection letter? Once you file for bankruptcy, the "automatic stay" goes into effect instantaneously. The automatic stay places a halt on all debt collection activity, which means those upsetting calls cease, and those letters can no longer be sent to you. You can once and for all enjoy the peace and quiet that comes with an automatic stay. The automatic stay remains in place until your bankruptcy discharge. If a creditor has been notified that you filed for bankruptcy and they still harass you, they can face legal repercussions including fines.
2.You don't have to pay qualifying debts ever again.
With a Chapter 7 bankruptcy, most debts are discharged or otherwise erased, meaning you will never have to pay them again. Such debts include: credit card bills (which can be tens of thousands of dollars), certain taxes (over 3 years old), past-due cellular phone bills, past-due utility bills, medical bills (which can run into the hundreds of thousands), and personal loans.
3.No one needs to know that you filed.
You don't have to tell anyone that you filed for bankruptcy, it can be strictly between you and your attorney or you and your spouse and your attorney (if you are married). The only time your bankruptcy would come up is when your credit report is being run or when you're applying for a new loan or credit card.
4.You don't have to give up everything you own!
When filing a Chapter 7, state or federal bankruptcy exemptions (your choice) allow you to keep certain types of property and up to certain amounts of equity. There are exemptions for vehicles, personal property, the homestead, household goods, clothing, jewelry and much more. As a Michigan filer, you have the unique advantage of being able to choose between three sets of exemptions: Michigan's regular exemptions, Michigan's bankruptcy-only exemptions, and the federal exemptions.
5.You CAN rebuild your credit following a discharge.
Contrary to popular belief, you can rebuild your credit after a bankruptcy discharge. It is very important that you develop a sound budget and stick to it, and pay all your bills on time. Once your debt has been discharged, you can consider your slate wiped clean. You can now apply for new credit cards and loans; however, those interest rates won't be low, nor will those credit lines be high initially, so the best way to improve your credit rating is to prove you are a responsible debtor. While bankruptcy does remain on your credit for ten years, you can rebuild your credit well before the ten years is up if you work at it.
To learn more about the benefits of filing a Chapter 7 or a Chapter 13 bankruptcy, please contact a Detroit bankruptcy attorney from the Law Offices of Marshall D. Schultz. With over 33 years combined experience and over 10,000 consumer bankruptcies under our belt, we are more than qualified to assist you in your debt relief matter.