There once was time when filing for bankruptcy was seen as shameful and a sign of personal failure. Nowadays, Florida residents and others are beginning to realize filing for bankruptcy can be the smart way to regain financial control. In fact, Chapter 7 bankruptcy can be a useful tool for those who are saddled with home debt after the housing market collapsed.
One couple in particular found Chapter 7 bankruptcy to be the best option for them. The couple helped finance their son’s second condo home. When the homes lost significant value, they sought another mortgage on a home they figured they could afford and then sought a short sale of the condo units. The bank would not take back the property, and the short sales did not work, leaving them stuck and creating a large amount of stress on the couple, both personally and financially.
Chapter 7 bankruptcy was the solution to their situation based on their individual needs and liabilities. With this type of bankruptcy, assets were liquidated and repayment of debt began. Many debts can be discharged, and this option is essentially seen as reset button. This option allows a debtor to start the process of rebuilding credit and getting a handle on the situation.
While each person’s situation in Florida may be different, the bankruptcy options available can provide instant relief from debt collector calls, home foreclosure action and other actions that may be causing distress and making the situation worse. Chapter 7 bankruptcy may be the right path and help someone simply stop the downward spiral. Before deciding if and what type of bankruptcy may be best, all types should be investigated and understood.
Source: foxnews.com, “Using personal bankruptcy to hit the reset button on distressed properties“, Robert Massi, Aug. 27, 2015