Pros
1) Absolution of Creditors
When you are in debt, creditors will continuously contact you by phone or mail to remind you to make payments. These actions can be extremely stressful. If you file for bankruptcy, the court will order your creditors to cease all collection efforts, and your attorney will be in charge of all dealings with your creditors. This means that you are no longer required to deal with your harassing creditors.
2) The freezing of foreclosures and repossessions
When you are in debt and have mortgaged your property or used your vehicle as collateral for a loan, you run the risk of having these assets foreclosed or repossessed. Filing for bankruptcy will halt all efforts to repossess or foreclose on your residence or vehicle, ensuring you do not lose these essential assets.
3) A New Start
When you are struggling to pay your debts, it is nearly impossible to lead a positive financial existence. You are able to get back on your feet and begin rebuilding your financial situation after filing for bankruptcy.
4) Safety from Legal Actions
One of the concerns of debtors is the possibility of being prosecuted by their creditors. Once you have filed for bankruptcy, your creditors cannot pursue a lawsuit against you for outstanding debt.
5) Extended Payment Periods for Non-dischargeable Debts
The majority of your debts can be eliminated through bankruptcy, but certain debts are not dischargeable. These debts include those not listed in your bankruptcy petition, as well as student loans, taxes, fines, and child support. Filing for bankruptcy provides you with additional time to repay your nondischargeable debts.
6) Right to Retain Primary Home
The majority of states permit bankruptcy filers to maintain their primary domicile. In some states, filers can exempt their primary residence, vehicle, and other essential possessions when filing for bankruptcy.
Cons
1) Relinquishment of Possessions
Insolvency requires a sacrifice. When you file for bankruptcy, the court will order you to surrender certain non-essential possessions.
2) Poor Credit Record
The bankruptcy status will remain on your credit report for ten years after filing. This will make it harder for you to qualify for a loan, mortgage, insurance, and insurance discounts. It can also affect your employment prospects.
3) Credit Card Theft
Additionally, bankruptcy can result in the loss of credit cards. You will not be permitted to use the credit cards you failed to repay prior to filing bankruptcy.
4) Some Debts are Non-Dischargeable
While filing for bankruptcy can help you reduce your overall debt, it may not eliminate it entirely. You must continue to repay your non-dischargeable debts.""
" - https://www.affordablecebu.com/
