You might be able to relate to many other people in Tennessee who prefer to avoid certain types of conversation. For instance, many people avoid discussions about their own mortality, which means they don’t like to talk about estate planning issues. It is also common for people to want to steer clear of discussions about financial crises. In such cases, the topic of bankruptcy is taboo.
In the past, there has been a stigma attached to bankruptcy. Some people mistakenly believe that filing for this type of debt relief equates to financial failure. They see it as a last-ditch effort to get a derailed financial train back on track. To the contrary, filing for bankruptcy need not be a last resort at all. In fact, submitting a petition early on may not only alleviate financial distress, but it can help lay the groundwork to restore solvency down the line.
Filing for bankruptcy can save a home from foreclosure
If you have encountered a financial crisis that has impeded your ability to keep up with mortgage payments, you might be worried about foreclosure. If you have already received a Notice to Foreclose in the mail, then it suggests that your lenders are ready to get the ball rolling in this direction. Rather than waiting to see what happens or disregarding a notice in the mail, it might be better to explore bankruptcy options right away.
There are certain types of bankruptcy that create an automatic stay against debt collections, personal injury lawsuits and home foreclosures. This means that, if you qualify for one of these programs, the foreclosure process comes to a halt, even if the court has already activated it.
Debt relief that can spare you from wage garnishments
In certain cases, the government may order your employer to withhold wages from your paycheck, in order to pay a debt. Filing for bankruptcy may help you avoid wage garnishments. This is another reason why it is a good idea to explore bankruptcy options at the start of a financial crisis, rather than resort to it as a last-ditch effort.
Restoration of your credit score
Data shows that, two years after filing for bankruptcy, at least 28% of applicants are able to restore their credit scores to the mid-600s. After four years, the percentage is even higher.
It’s commendable to want to pay your debts. However, there is nothing to be ashamed of or embarrassed about by reaching out for additional support when financial problems have made it difficult to meet your expenses and satisfy debts that you owe. It’s not uncommon for such problems to arise, and resolving them often hinges on knowing where to seek support and seeking it sooner, rather than later.
