Nashville Bankruptcy Attorney on the Pros and Cons of Filing
May 12, 2021at4:00 AM
For many people, living in debt is unavoidable. In fact, according to recent reports, the total amount of U.S. consumer debt is $13.86 trillion. While having debt isn’t necessarily a bad thing, when the amount you owe becomes unmanageable, it can seem impossible to get out from under it. One solution that has proven to be effective at reducing the amount of debt an individual owes, or eliminating it entirely, is filing for Chapter 7 bankruptcy.
If this is an option you’re considering, the Nashville bankruptcy attorneys at Morgan Dale Law, PLLC, can help. First, though, we want you to understand that while it does help provide debt relief, it doesn’t come without any repercussions. This guide will help you understand the pros and cons of filing Chapter 7, so you can decide if it’s right for your unique financial situation.
Pros of filing for Chapter 7 bankruptcy.
Eliminate all of your outstanding debt.
The main draw behind Chapter 7 bankruptcy is that it allows you to get rid of most, if not all, of your unsecured debt. This includes everything from credit card bills to medical bills, personal loans, payday loans, and cash advances. It’s your chance for a fresh start that allows you to rebuild your finances.
The relief is immediate.
Our Nashville bankruptcy attorneys recommend Chapter 7 to clients who want to get creditors off of their backs quickly. As soon as you file for Chapter 7, an automatic stop is triggered for all collection actions. That means you won’t receive any more stressful calls, garnishment of wages, or collection letters.
You won’t lose your belongings.
Under Chapter 7 bankruptcy laws, certain property is exempt from being taken away. Some of the things that fall under the exempt category include houses, cars, property backed by a secured loan, retirement accounts, and household goods. This gives you peace of mind knowing you’ll still be secure as you navigate the process.
Cons of filing for Chapter 7.
It’s not free.
Despite the fact that you’re likely filing for Chapter 7 because of money troubles, the process still requires an upfront investment. The bankruptcy court charges a fee when you file your case with them. Plus, unless you want to go through it alone, you’ll have to pay to hire a bankruptcy attorney in Nashville.
You’re required to take educational courses.
In order to have your debts discharged, the court will order you to take a credit counseling course. These are designed to help you learn financial management skills to avoid ending up in the same situation. While there is helpful information in there, it does still require an investment of your time.
It stays on your record for the next ten years.
If your filing goes through successfully, your credit report will indicate that you’ve declared bankruptcy for the next decade. When that happens, you’ll experience a drop in your credit score, and creditors will factor your bankruptcy into their decision to grant you a loan. While you can still receive a loan or new credit card, the interest rates will be much higher and will come with various fees.
Are you considering filing for Chapter 7 bankruptcy?
Before you make any decision, it’s always best to consult with a Nashville bankruptcy attorney. Here are Morgan Dale Law, PLLC, we specialize in helping individuals who are struggling with debt find the ideal solution to alleviate their burdens or eliminate them entirely while still protecting their financial future.
We will work with you to understand the peculiarities of your unique situation and devise the best strategy that helps make your debt more manageable. You have many options for getting out of debt, and we can make the entire process as easy as possible. You can learn more about our firm, or reach out to us online to schedule your initial consultation.