Marylanders know that life deals out challenges and many of these can be financial in nature. It may be a medical emergency, job loss, pay cuts or even a divorce. Due to their financial situations an individual may not be able to pay their bills and the unrelenting calls from debt collectors can turn into a nightmare. Wage garnishments, lawsuits and other collection practices may be used by the debt collector.
An individual may look at various ways to pay their debts, but sometimes repayment is not possible and the person’s financial situation just gets worse. In certain situations, a repayment plan and debt consolidation with their creditors can help the person get debt relief. However, as mentioned in our blog, when all options have been considered and nothing else seems to help, an individual can consider filing for bankruptcy.
Experts advise that when someone is insolvent and they have more liabilities than assets, they should consider bankruptcy. The person can file for bankruptcy under Chapter 7, Chapter 11 or Chapter 13.
When someone files for bankruptcy, it will stop all collection efforts including lawsuits. Also, each bankruptcy filing has specific attributes. While chapter 7 allows people to erase many of their debts, chapter 13 allows the borrowers who have a stable source of income, to repay their debts under a court supervised plan. Chapter 13 can also help someone stop the foreclosure process on their home.
However, not every person should file for bankruptcy and not every person is eligible to file under the Bankruptcy Code. For additional information on bankruptcy filings, you may refer our website page on Consumer Bankruptcy.