Reasons Not To File A Bankruptcy
November 4, 2022
Banks, credit card companies, and finance companies insist that Bankruptcy is the last resource. Why? From their point of view it makes sense: they will be able squeeze the last few dollars from people and small business with severe financial problems. When the Bankruptcy law was changed in 2005 banks said by people delaying filing Bankruptcy they (the banks) would gain millions of dollars from people.
BANKRUPTCY IS EMOTIONALLY STRAINING.
Any financial move has an element of emotions. But, think about this: do banks, finance companies and credit card company factor emotions in their decisions? They have no problem using every legal tool at their disposal to collect money and don’t care what harm it does to you.
Let’s see. They sue, garnish wages, garnish bank accounts, and repossess autos, foreclosure on homes. Frequently when consumers fall on hard times they raise interest rates. And, don’t forget collection calls and threats.
It is simply business for them. Should it be different for people? Our current President has said Bankruptcy is a tool and he used more than once.
I AM EMBARRASSED.
No one looks forward to filing a bankruptcy. But, piling debts, wage garnishments, etc. is far more difficult to deal with. As to your friends, family, and co-works: many of them have filed bankruptcy and you even know; or, if you do know do you look down upon them?
Also, in large metropolitan areas new bankruptcy filing are listed in obscure newspapers that few people read.
ALREADY FILED A BANKRUPTCY?
Even if you filed a prior bankruptcy that does not prevent you from filing a bankruptcy now. There are certain time restrictions as to filing a second Chapter 7 but does apply to a Chapter 13.
An experienced lawyer who concentrates in Consumer Bankruptcy can advise you on the required waiting periods between filings.
Our blog explains the time period requirements:
You can always call us to explain the time periods and how it applies to you.
YOU CAN’T FILE CHAPTER 7 BANKRUPTCY IF YOU HAVE A JOB.
That’s not true. There is a “Means Test” before consumers can file any bankruptcy. If effects a small percentage of individuals. See our blog on the Means Test: https://www.robertadamslaw.com/beat-means-test/
Even if your income is higher than the median income there are plenty of ways to file a Chapter 7 or filing a Chapter 13 paying a very small dividend to unsecured creditors.
MEDICAL BILLS CAN’T BE DISCHARGED; OR CREDIT CARDS CAN’T BE DISCHARGED.
Yes they can. There are very few debts that can’t be discharge. The biggest one, of course, is student loan debts.
YOU CAN’T DISCHARGE PAYDAY LOANS
I frequently hear that certain Payday Loan companies and collection agencies tell people that these loans are exempt from bankruptcy. That is a big fat lie: Our attorneys regularly discharge payday loans in bankruptcy.
Some lenders and bill collectors resort to threats and harassment. They may say you will be arrested or prosecuted if you are unable to repay a loan. Untrue. Debt is not a crime! In fact, creditors can be sued and fined for abusive behavior that violates the Fair Debt Collection Practices Act
CHAPTER 13 REQUIRES ALL DEBTS TO BE PAID IN FULL.
Most Chapter 13 cases repay unsecured debts a fraction of the amount due: like 10%.
BANKRUPTCY KEEPS YOU FROM GETTING CREDIT FOR 10 YEARS.
Individuals who file Chapter 7 start getting credit cards and buy cars almost immediately after they file bankruptcy.
BANKRUPTCY WILL HURT YOUR CREDIT SCORE.
Really? When people are in financial problems they generally have low scores. After filing bankruptcy their scores start to rise. After 6 months to a year an individual’s score can easily jump to the 600’s or even the 700’s.
YOU WILL LOSE EVERYTHING IN A BANKRUPTCY.
Almost all Chapter 7 are what is called “no assets” cases. That means you keep everything. Illinois has a series of exemptions to protect a person filing bankruptcy.
If you are worried an experienced lawyer who concentrates on Consumer Bankruptcy can guide you and work out a good solution to your problem.
Exemptions for personal property in Illinois: https://www.robertadamslaw.com/personal-property-exemptions-illinois-chapter-7-chapter-13/
Homestead exemption in Illinois: https://www.robertadamslaw.com/homestead-exemptions-illinois/
Contracts That Prohibit Filing BankruptcyAny contracts that prohibit or limit your rights upon filing a bankruptcy are null and void.
IRS DEBTS CAN’T BE DISCHARGED.
Surprisingly a great deal of IRS can be discharged.
If you have IRS debts please go to: https://www.robertadamslaw.com/can-i-discharge-taxes-in-bankruptcy/
BANKRUPTCY IS A PERSONAL FAILURE.
The overwhelming cause to bankruptcy is things out of one’s control. Frequent factors include very high medical bills, loss of a job, helping family members, divorce, and large unexpected bills. The list can go on and on. Maybe it was a bad decision: it is still the best decision to get one’s life on tract. Trump apparently made a bad decision of buying a casino in Atlantic City. He filed bankruptcy on the casino and he seems to being doing OK financially.
MARRIED COUPLES MUST FILE TOGETHER.
No. Our law firm has had innumerable people file a bankruptcy without their spouse.
Whether a married person files a case alone or with their spouse is a fact based decision.
An experience lawyer who concentrates in Consumer Bankruptcy can give you the options and advise.
BANKRUPTCY IS NOT FOR EVERYONE
Bankruptcy is a serious matter. But, one you are having serious financial troubles like falling behind on bills, barely keeping up on minimum payments, using Pay Day loan, monthly debt payments are way too much talk to a lawyer who concentrates in Consumer Bankruptcy.
ROBERT J. ADAMS & ASSOCIATES has helped thousands of people to restart life “debt free” or using Chapter 13 to organize bills to save your car and/or house.
Our consultations are always Complimentary and confidential
For more information on Reasons Not To File A Bankruptcy, a Complimentary consultation is your next best step. Get the information and legal answers you are seeking by calling today.