Hopefully, you’re reading this blog, because you’re looking for information about bankruptcy and you think that I provide reliable information. That’s my objective. I’ll be the first to tell a prospective client that I think bankruptcy should be an option of last resort. I have talked more than a few prospective clients out of filing bankruptcy after their free consultation. Sometimes, there are better options than bankruptcy. Sometimes, biting the bullet and paying down debt is a better option than bankruptcy. This is especially true if we’re talking about a small amount of debt or if non-dischargeable debt, like student loans or child support, is creating a financial hardship.
I think it’s important to provide other perspectives as well. If you read Gail MarksJarvis over at the Chicago Tribune you know she is not a fan of bankruptcy. She does believe, however, that in some cases it’s appropriate and possibly a person’s only option. One of the crucial points that she makes to these people is that timing is important:
The advantage of bankruptcy is that foreclosures, evictions, repossession, garnishment of wages or Social Security payments, utility shut-offs and collections calls stop. If a person waits too long to file, a legal judgment might eliminate options for saving an asset.
“Do not wait until the car is on the verge of repossession or two days before the home is foreclosed,” said bankruptcy attorney Max Gardner.
Once you file for bankruptcy, only the debts you have had up until then are relieved. Say you’re unemployed and relying on credit cards for food and gas. If you file for bankruptcy, the card companies might cancel your cards. But while you’re in bankruptcy, you might get credit card offers, because the banks might consider you a safer risk now that you have little or no debt and you can’t file for another seven or eight years. Remember that you won’t get any relief for debts taken on after bankruptcy.
Bottom line: Timing is crucial.
“If you are sick and need surgery,” Twomey said, “don’t file before the surgery.”
She’s absolutely right in this regard. Trying to unwind a foreclosure sale after the fact is going to be costly, time consuming, and emotionally draining. This is just one reason why you should talk to a bankruptcy attorney as soon as you get notice of foreclosure or repossession of your car. Bankruptcy – in certain circumstances – can stop both from happening.
You can read the article here.