Are you drowning in debt? Many circumstances can render you unable to meet all your financial obligations. Fortunately, if you find yourself in over your head, you can file for bankruptcy protection.
There are two types of personal bankruptcy, and both offer you a degree of protection. Declaring bankruptcy can put a quick stop to several threats.
Debt collection activity
Even when debt collectors stay within the confines of the law, their tactics can feel like harassment. They may call you many times each day in an effort to collect money. They may go so far as to call you at work until you request they stop. Bankruptcy imposes an automatic stay that prohibits debt collectors from contacting you.
Any items you purchased with a loan are subject to repossession, such as your house and vehicle. Creditors may also repossess furniture and appliances you bought in a rent-to-own arrangement.
In many cases, lenders have the right to take items back after just one missed payment. However, you may avoid repossession of certain assets, including your home and auto, by filing for bankruptcy.
A court may order your employer to garnish your wages, or withhold a portion of your earnings to pay debts. In some cases, creditors may take a lump sum from not only your regular wages, but also from bonuses and commissions. Courts may order garnishments from other income including retirement plans. Bankruptcy can stop existing garnishments and prevent new ones.
Bankruptcy can end your sleepless nights worrying about money. It may permit you to stay afloat and avoid undue stress while you get your finances in order.