What Are Some Main Reasons One Might File For Bankruptcy?

There are many reasons that it would be advantageous to file for bankruptcy, but here are some of the most common reasons:

1. The first reason to file for bankruptcy is to stop a foreclosure sale. Filing for bankruptcy immediately stops a halts a foreclosure suit against you. This can give you time to reorganize your finances, try to sell your home, negotiate a modification, or find another place to live. Your chapter 13 Plan can let you catch up on your arrearages over a 5-year time span and so cure your default. If your home has been foreclosed upon, bankruptcy might be a good option for you.

2. Filing for bankruptcy not only stops a foreclosure suit, it halts almost all legal actions taken against you, such as a garnishment or auto repossession. If your auto is in danger of being repossessed, filing for bankruptcy will keep the creditor from doing so. You can value your auto in the bankruptcy and pay only fair market value to the creditor. This means that if you owe $20,000 on your auto and it is only worth $10,000. you can pay the $10,000 to the creditor through your bankruptcy and own the vehicle outright after your Plan is completed.

3. If debt collectors are hounding you too much, filing for bankruptcy can help. Immediately upon filing, creditors must stop from trying to collect the debt. This means the harassing phone calls and letters will stop. For most, this is a big relief.

4. If you are simply behind in your bills and need a chance to catch up or for the debts to be discharged altogether, bankruptcy probably is a great option for you. Some people are just too in debt and need a fresh start. Bankruptcy can provide this to you.

5. If you would like to surrender your property to the creditor and not be liable for any deficiency amount, bankruptcy will allow you to do this. If you surrender the property back to the creditor outside of bankruptcy, the creditor can almost always sue you for the deficiency amount (the difference in what you owe on the property and what they can sell the property for). If you do the surrender through the bankruptcy, the creditor cannot come after you for this money.

These are just some of the reasons that filing bankruptcy might be in your best interest. There are many more, and every case is different. To schedule a free consultation with a Jacksonville Bankruptcy Attorney, call 904-685-1200 today.