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Get to know these 3 positive effects of bankruptcy

On Behalf of | Sep 25, 2020 | Bankruptcy

When you think about a bankruptcy, you might not look at it as something that is a positive. However, bankruptcies do have several positive factors to consider. While you will see some downsides, like watching your credit score dip or potentially having to give up some assets, there are many benefits that make those downsides worth it for those in true financial trouble.

Some potential benefits include:

  • Eliminating credit card debt/unsecured debts
  • Stopping harassing phone calls/contact from debt collectors
  • Preventing wage garnishments

Here is a little bit more information about each of these benefits.

Eliminating credit card debt and unsecured debts

While it’s hard to eliminate secured debts in bankruptcy, unsecured debts are often discharged. Things like credit card debt might be holding you back financially, but if you choose bankruptcy, those debts may be able to be eliminated. Other unsecured debts may also be discharged when you emerge from bankruptcy.

Stopping harassing debt collectors

Sometimes, debt collectors start overwhelming those who are in debt. They may call frequently throughout the day, send multiple letters and generally cause the person great distress. The good news about bankruptcy is that it stops those phone calls and letters in their tracks. Debt collection efforts are stopped immediately, as well. If you do have another phone call or message, then you just forward it to your attorney.

Preventing wage garnishment

If debt collectors or creditors take you to court and sue, you could end up facing wage garnishment. To prevent that from happening, one of the better things to do is to talk to your attorney about bankruptcy. Bankruptcies prevent wage garnishment, so that you can find other ways to get out of debt or to address debts without having income directly withdrawn from your accounts.

Being in debt isn’t easy, and stress over money can ruin relationships. The good news is that there are solutions available to anyone who is struggling with debt. Your attorney will be happy to talk to you about the different bankruptcy options and how they can help you if you’re in over your head and drowning in debt.

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