Consumers in Pennsylvania typically do not enter adulthood with the expectation of filing for bankruptcy. However, sometimes, filing for personal bankruptcy is necessary for those whose liabilities end up outweighing their assets. A few tips may help with determining whether filing for bankruptcy is appropriate in one’s situation.
Bankruptcy is not necessarily required just because a consumer has a hard time covering bills one month. However, not filing soon enough may also be a major mistake in certain cases. Now may be the ideal time to file for bankruptcy if collection agencies have started to line up and if covering basic necessities, such as food or heat, has become a challenge.
Chapter 7 bankruptcy is designed for those whose financial situations are severe. In other words, they do not have enough additional income and have severe unsecured and secure debt. The benefit of Chapter 7 bankruptcy is that, with this type of bankruptcy filing, a portion of one’s unsecured debt may be reduced. However, anything that is not absolutely necessary to live on a daily basis — also known as non-exempt property — will end up being sold so that debt can be paid off.
Filing for personal bankruptcy can be a major help for those who are financially under water and need a brand-new start. However, this complex process can be challenging and overwhelming. A bankruptcy attorney in Pennsylvania can provide guidance with each step of this process so that one can finally enjoy much-needed financial freedom in the years ahead.
Source: huffingtonpost.com, “When Bankruptcy Can Be of Great Benefit“, Allan Smith, Dec. 9, 2017