Bankruptcy: It's Not All Doom & Gloom

Money is a topic that not many like to talk about unless it’s because they have it. It’s a sensitive one, with topics like debt and struggling to make ends meet off the social table. The trouble is, money is a contentious subject for a reason. When you don’t have it, it’s a big problem and if we talked about that more, we’d be more likely to get some help and advice to help avoid the issues. There was a time where bankruptcy used to induce a reaction of pity and sorrow, where now more people are filing for bankruptcy than ever.

Bankruptcy

People go down the route of bankruptcy for various reasons, including job losses, divorce, judgments and tax debts. It’s not something anyone wants to do at first, and you can read this article for more information on how you can avoid bankruptcy altogether. However, there are many reasons that bankruptcy isn’t all that bad. It goes beyond a good foreclosure defence if you’re about to lose your house. There are some really solid reasons that will not only help your bank balance in the long run, but make you more secure, too.

  • Avoiding creditor calls is the number one reason people file for bankruptcy. Harassment at all hours of the day via telephone as well as having the doorbell going during the day with home visits can be very stressful. The constant scrutiny can put you on edge and make you feel like a prisoner in your own home. Once you’ve filed for bankruptcy, that cannot happen anymore by law, and the relief can help you think straight and get you back on your feet.
  • Have you ever been served papers and sued for debt owing? It’s not nice, but if you have buried your head in the sand over it, you will lose in court and a judgment on the amount owing will be placed on you. This is one of the scariest things for those who want to keep their debts concealed, as a judgment can be used to garnish your paycheck. In a bankruptcy, judgments can be eliminated, alleviating the pressure on your already stretched salary.
  • The biggest fear those wishing to file bankruptcy is that they will lose their home if they do so. There are two things that can happen in a bankruptcy. The first is that you could surrender your home to eliminate all mortgage debt you may owe and give you a bit of relief. The second is that you could reaffirm the current debt with your mortgage company and if your equity is below $22,000 you could keep the house.
You see, most people believe that bankruptcy equals a black mark against your name and you lose everything. The truth is that while the bankruptcy will stay on your credit file for ten years, you are actually seen as LESS of a risk to creditors because you cannot refile again for eight years. The myths surrounding bankruptcy need to be addressed so that peace of mind can be offered.

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