If circumstances are forcing you into a position where you’re thinking about a bankruptcy, and you own a home, it’s important that you speak with us. We’ll want you to get a grasp on this complicated area of bankruptcy law. Our knowledgeable and experienced Los Angeles bankruptcy lawyers have helped countless people to extricate themselves from crushing debts.
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Social Stigmas and bankruptcy
There’s a stigma associated with bankruptcy. A bankruptcy filing becomes public record, it stays on your credit report for 10 years and it may create certain complications for you if you want to get a house or rent an apartment. However, in certain situations, bankruptcy is the best thing that you can do and it’s another form of asset protection.
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Sometimes people wait too long because of the stigma. I think the creditors and credit card companies, in some ways, brainwash people to try to scare them from filing for bankruptcy. But I look at bankruptcy as an economic decision. You have to be proactive and you have to look at your situation.
I’ll give you an example. Sometimes people are trying to pay their credit card balances and their income dropped, for example. So instead of concentrating all their income towards their mortgage payment and protecting their retirement fund, they try to pay high interest credit card debts along with other bills just to avoid filing for bankruptcy.
As a result, they have judgments against them and they’re finally unable to pay their credit card debts any longer, but they also end up losing their house or cashing out their retirement funds, which is a very wrong thing to do, in my opinion. People should seek consult with an experienced bankruptcy professional and really crunch the numbers and analyze their particular situation to make sure that the main assets that they own are protected.
There are also a lot of different programs that are available for people who just graduated and are unable to find jobs and need relief from their student loan obligations. I also think eventually there will be some sort of new law that will enable people to discharge either a certain portion of their student loans or certain types of student loans such as private student loans.