Friday, January 28, 2022

Is Bankruptcy Right for You and Your Credit?

 

Bankruptcy sounds terrible, but it's not the end of the world. It may even be the right option for you. Many patrons in the Mansfield, Columbus, and Canton, Ohio areas looking to file bankruptcy have done so successfully. Bankruptcy can alleviate a lot of everyday stress that could be detrimental to your health. It stops collection calls, lawsuits, threat letters in the mail, and the potential for wage garnishments. In a clear sense, it erases your debt. Despite what you’ve heard about the scary facts, bankruptcy may help your credit scores. So truth be told, credit bureaus and scoring experts often say bankruptcy is the single worst thing you can do to your credit and your ranking for future borrowed purchases. There are foreclosures which is the legal process by which a lender attempts to recover the amount owed on a defaulted loan by taking ownership of the mortgaged property and selling it; repossessions can occur when a credit account is delinquent, the lender can take action to repossess the property tied to the loan without notice, charge-offs are taken off the creditor's balance sheet when a payment is between 90 and 180 days past due. If no payment is made, creditors assume the debt is unlikely to be paid, and then the dreaded collections. Although these are severe factors for your score — nothing else can drive you down as fast and far as a bankruptcy. 

The critical thing to know is that’s not the whole story. Most people struggle so long with their debt that their credit is already battered by the time they file for bankruptcy. Once they decide to take the leap of faith, their scores typically rise, not fall. If the debt is erased or, as the court states, as a “discharge,” your score can begin to increase, and within a year, you may be way better off.
Having the right attorney can help you discharge your debts and help you identify which type of bankruptcy filing is right for your situation is crucial. At Badnell & Dick Co. L.P.A, we're here to help walk you through the process. To learn more, call 800-234-9511 or visit us online at www.badnellanddick.com
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