In Part 2 of Bankruptcy 101, Los Angeles Bankruptcy Lawyer Natella Royzman explains:
Benefits of Bankruptcy
Common Myths about Bankruptcy
Effects of Bankruptcy on Your Credit
[In Part 1 of Bankruptcy 101, Ms. Royzman goes over how to discharge your debt through different bankruptcy chapters.]
[In Part 3 of Bankruptcy 101, Ms. Royzman discusses how bankruptcy can bring fresh new opportunities to those seeking relief.]
Click below to listen to Part 2 of Bankruptcy 101 in which Ms. Royzman goes over how bankruptcy is a powerful legal solution to your debt problems.
As a bankruptcy specialist, Ms. Royzman uses her legal expertise and pragmatic approach to help people get the relief they are entitled to and absolutely need.
If you are struggling financially and need to know if bankruptcy is right for you, Ms. Royzman can evaluate your situation and help you weigh your options – including the different types of bankruptcy – to find the solution best suited for your situation and goals.
Don’t let the stress of overwhelming debt impair the quality of your life!
Benefits of Bankruptcy – A Second Chance
Bankruptcy can offer a life-changing benefit to people in a wide variety of situations. Many people have massive credit card debts that are rapidly accruing interest and penalties at alarming rates, and they struggle to make even the minimum monthly payment.
Others have medical bills or tax liability that has caused their finances to take a turn for the worse. Failed business ventures or divorces often take a huge financial toll.
Whatever the catalyst for your financial troubles, bankruptcy may be the solution to stop the negative cycle, start over, and rebuild your financial life. Don’t continue to stress about not being able to make your payments. You can stop this terrible situation, recover from it, and restore your life – while keeping your wages, home, and other property.
People file for bankruptcy to get a “discharge” – a court order which provides that you are no longer responsible to pay certain debts. Most debts that arose before you filed are dischargeable and will be completely wiped out when you get your bankruptcy discharge.
However, there are some debts, such as student loans, spousal/child support, recent tax liabilities, government fines and penalties, and debts incurred through fraud, which cannot be discharged.
Stigma of Bankruptcy –The Guilt Factor
So many individuals don’t get the help they need because they feel guilty or ashamed about the fact that they are considering bankruptcy. They think that filing for bankruptcy means that they are a failure.
[Read more on why You are NOT a Failure!]
This stigma surrounding bankruptcy benefits creditors by keeping struggling individuals from exploring legal options that would truly improve their lives. Filing for bankruptcy does not make you a failure; it gives you the ability to move on and succeed, rather than being unfairly weighed down and defined by past mistakes or circumstances beyond your control. You can be sure that credit card companies don’t feel any guilt or shame when they provide people with confusing, incomprehensible terms, or charge hidden fees, escalating interest rates and severe penalties. If you have longstanding credit card debt, chances are that if you look closely, you may find that you have already paid for the items you purchased three times over, and still owe much more than you originally paid.
Choosing a Good Attorney Makes a Big Difference
Be careful to choose an attorney who is knowledgeable about bankruptcy law and with whom you are comfortable asking questions. You will be disclosing all of your personal financial information, and the process will be much smoother and more pleasant if you are dealing with someone you like and can trust.
A good attorney will listen to your concerns, evaluate your situation considering all the angles, and explain the pros and cons of all of your options. If bankruptcy seems like a good option for you, a skilled attorney will prepare a strategy to optimize your benefit, and will explain the process and any risks involved.
While those billboard and bus bench ads for $300 bankruptcy attorneys may be tempting, you get what you pay for in the end, and the consequences may cost you much more than your prospective savings. There are many potential pitfalls and risks when you file for bankruptcy (your property can be taken, your friends or relatives could be sued, you may be denied a bankruptcy discharge, etc.), which may be minimized or avoided entirely with the right representation. Potential problems can almost always be foreseen and considered prior to filing.
Bankruptcy is a complicated and technical field, so make sure you find a competent attorney who can protect you and will spend an adequate amount of time on you and your case.
Effects of Bankruptcy on Your Credit
By the time you are considering filing for bankruptcy, your credit is probably already bad and getting worse as time goes on. Every time you miss a payment, it is a negative report on your credit score. Once you file for bankruptcy and receive your discharge, the debts that are wiped out will be removed from your credit report or will reflect a zero balance. No more negative reporting, so all you can do is go UP and start building your credit immediately! Also, because you can only file for Chapter 7 every eight years, you are less of a credit risk after filing than someone who has not filed and can therefore file at any time. Most clients report that their credit score goes up by 100 or more points as soon as their discharge is entered.
Many people are surprised about how quickly they get offers for credit – usually within a few weeks of filing their case. If you are smart with your credit (e.g. you pay your bills regularly and treat credit responsibly), you will see your credit score improve more rapidly.
Take control of your finances by contacting us today
Located in Los Angeles, Royzman Law Firm provides a wide range of services for individuals, entrepreneurs, and small-to-midsize businesses dealing with unmanageable debt. Call Royzman Law Firm at 310.954.8503 or contact us online to schedule a free consultation.
Please note that the materials appearing on this blog are provided for informational use only, and are in no way intended to constitute legal advice or the opinions of this law firm or any of its attorneys. The law is constantly changing, and the materials appearing on this blog are not guaranteed to be correct, complete, or up-to-date. You should not act or rely upon any information appearing on this blog without consulting a qualified attorney for individual advice regarding your own unique situation. Transmission of information through this blog or this website does not create any attorney-client relationship between you and Royzman Law Firm, Inc. or Natella Royzman, Esq.