There comes a time in life when debts just feel overwhelming. You have a family to look after and may not be able to pay the creditors back. In such circumstances, bankruptcy could be an option worth considering. There are law firms that can help you file for bankruptcy in Katy, but before that, here is a look at the benefits you can expect.
Put a stop to creditor actions
The moment you file for bankruptcy, your creditors cannot take action against you. For instance, if your home was at stake, you can avoid an immediate foreclosure. Not that it does away with the consequences of not paying debt, but you can avoid unwanted lawsuits and too many calls.
Improve your credit
One of the other reasons why many people consider bankruptcy is to improve their credit score, but a lot is dependent on the circumstances. However, there is some scope that the debt-to-income ratio will improve considerably, which will come in handy for the future. Note that, however, bankruptcy will remain on record for a period of 7-10 years.
Start afresh
Let’s not forget that filing for bankruptcy does have consequences. However, at the same time, you can expect to start afresh. You can have better control of your finances, determine what works or doesn’t work for your financial situation, and without those credit cards, you will learn to live on your income and not have future debts.
Other things to know
It is important to be prudent about bankruptcy. There are consequences of bankruptcy that cannot be avoided. First and foremost, you will lose out on credit cards, and if you have offers for unsecured credit cards, this may mean paying high annual fees and interest rates. As we mentioned, the bankruptcy will stay on a credit report for at least 7 years, which can impact your ability to get a loan, and not to forget, you may lose some of your real estate and properties to pay the creditors.
Talk to an attorney
Is bankruptcy the solution to your problems? You should consider talking to an attorney, who can guide you on what may or may not work for the current circumstances. Nevertheless, bankruptcy is an option for many who are no more capable of repaying debts and are constantly living under the threat of losing all they have. The process requires considerable work, so you need an attorney by your side.
