Bankruptcy and Garnishments in Mentor

Bankruptcy is Positive The First Step to Prevent Wage Garnishments 

As soon as you discover you are unable to pay a bill, contact the person you owe. If it’s your first default, they may make a temporary allowance for you. It looks much better for you if you discuss the situation with them and show that you desire to pay.  

If the inability to pay persists, contact them again to try to work out a payment plan that you can afford. They will usually take this because they’d rather work with you than go through the collections process. 

Bankruptcy Prevents or Ends Wage Garnishments 

If the situation has already progressed to wage garnishment or you are unable to make any payment arrangements, you can get your life back on track with bankruptcy. Bankruptcy stops wage garnishments and provides you with a debt-free slate to work with so you can build your finances again. 

Types of Bankruptcy 

Chapter 7 Bankruptcy 

Chapter 7 is the most common type of bankruptcy. Called “liquidation bankruptcy,” this option includes selling all of your unprotected assets to pay back creditors or simply dissolving your debt without paying your creditors, if you don’t have unprotected assets to sell. Child support, student loans, and the majority of tax debts will still be owed. With Chapter 7 bankruptcy, you can erase credit card debt, personal loans, utility bills you are behind on, and medical bills. 

Chapter 13 Bankruptcy 

Chapter 13 is known as, “restructuring bankruptcy.” You don’t sell your assets. Instead, you work with the court to plan how you can pay the entirety or a portion of what you owe in three to five years. 

The Similarities 

With both types of bankruptcy, you are expected to incur no new debts until the bankruptcy period is over. After that, you will be able to rebuild your credit. That will probably require a secured credit card. 

Bankruptcy is Positive 

Most people have the common misconception that bankruptcy is something to be embarrassed by or that it will permanently damage their credit. Bankruptcy is taking responsibility for your financial situation and repairing it. You will feel much freer and able to take control of your finances after filing for bankruptcy. As for your credit, it will take a brief downturn, but then it will improve. If you need to file for bankruptcy, your credit is probably suffering or threatened anyway, so the long term will just get better.  

Some people are afraid that bankruptcy means they’ve failed, or they feel shame because they feel that owing debts is irresponsible. Many people are struggling financially, and many of the reasons people find themselves in debt are because of situations outside of their control such as medical bills, job loss, or pay cuts. Even if you made mistakes, they’re mistakes, and you’re doing exactly what you should to address them. That is empowering.  

Call Moseman Law About Bankruptcy & Working With a Wage Garnishment Attorney

Filing for bankruptcy is complicated. To ensure you file correctly for the optimum peace of mind, contact us to get started. We’re experienced bankruptcy lawyers and happy to help you start anew.