Are you hoping for a “new year, new you” when 2023 rolls around? You’re definitely not alone – but it can be incredibly difficult to reinvent yourself or climb to new heights with your ambitions when you’re mired in piles of old debt.
With inflation rising and prices out of control, the best thing you may be able to do for yourself if you want to get a fresh start on life is to file for bankruptcy.
Bankruptcy filings are on the rise
Current data indicates that bankruptcy filings are on the rise across all demographics. Individual filings (as opposed to commercial) have risen 6% between November 2021 and November 2022. A lot of that has to do with the general economic problems people are facing due to everything from natural disasters to job losses and the rising cost of living.
So, how can bankruptcy help you? Consider these examples:
- It stops all collection efforts: If you’re being hounded by debt collectors day and night, you may be half-afraid to even answer your phone or open your email. Once you file bankruptcy, a temporary injunction (or “automatic stay”) goes into place that stops all creditor harassment immediately. That can give you some much needed emotional relief and psychological breathing room.
- It can temporarily halt evictions, foreclosures and repossessions: The same automatic stay that stops other collection actions can also temporarily halt most evictions, foreclosures and repossessions. Depending on your situation, that may give you the opportunity to renegotiate with the landlord or lender. If not, it will at least give you time to regroup and make other plans.
- It will wipe out your unsecured debts: If you have medical bills that have gone into default or credit cards with outrageous balances, those can be entirely wiped out in a Chapter 7 bankruptcy. That can give you the financial ability to move forward with other goals.
Financial problems are hardly uncommon, especially in today’s world. If your financial issues have kept you from your goals, it may be time to consider better options.