A Bankruptcy Attorney In Tacoma Wa helps clients take steps for a positive future by wiping out eligible debt through filing Chapter 7. That includes unsecured debts such as medical bills, credit cards, and personal loans. The intention is for the person to make a fresh start financially. This individual now has the opportunity to rebuild credit and become more financially stable.
Constant Distress
Being in constant financial distress is exhausting. It’s not good for anyone’s mental, emotional, or physical health. On top of it, the problem tends to snowball because of late fees and adjustments to credit card interest rates as the cardholder falls behind. Those adjustments are always upward.
This person winds up contributing virtually nothing to the economy because all earnings are sent to essential bills and companies making collection efforts. People often worry about filing for bankruptcy because they know this stays on their credit record for several years. However, by the time most people file, their credit score is already poor because of late payments or nonpayment.
Issues With Chapter 13
Another option is Chapter 13, which doesn’t clear away debt but involves setting up a repayment plan that lasts up to five years. The obligations are combined into one payment that is more affordable than several separate payments. Many people do not qualify for this, however, because they do not have enough income to make the monthly payment. In addition, some who technically qualify have to make their budget so tight that the situation becomes unworkable. A lawyer like Rafal Gorski evaluates the client’s circumstances, determines which option is most advisable, and helps the person making a decision.
Obligations That Cannot Be Discharged
A Bankruptcy Attorney In Tacoma Wa will explain which obligations can be discharged and which must be paid. Student loans, child and spousal support, and some tax obligations are examples of debts that cannot be discharged. In addition, if the man or woman accumulated some new obligations in the previous six months, those might not be allowed. The court will be on the lookout for evidence of fraud, as some individuals are tempted to run up debt and then file for bankruptcy protection.
