Bankruptcy

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Frequently Asked Questions about Bankruptcy

Q: Why are so many consumers filing bankruptcy?

A: Americans generally have overextended themselves by using too much easily accessible credit to finance overspending, combined with lack of savings. With no financial safety net, sudden crises such as medical emergencies, job losses or failed businesses, death or disability of spouses, or divorce can result in insurmountable debt. On average, a typical bankruptcy debtor is employed and middle-aged with a high school education and relatively low income.

Q: What alternative courses of action are there to filing bankruptcy when facing overwhelming debt?

A: Short of bankruptcy, a debtor may enter into mediation with creditors or negotiate workout agreements to extend due dates, lower interest rates, partially forgive debt or alter other terms. A debtor may execute an assignment of property for the benefit of creditors (ABC), wherein the debtor puts assets in the trust of a neutral third party to pay creditors. A business debtor can sell the business, negotiating the satisfaction of debt as part of the deal. Other creative options to bankruptcy exist.

There were nearly 1.7 million bankruptcies filed in 2003, up 7.4% from the 1,547,669 filings in 2002. In fact, bankruptcy fillings have increased nearly 100% since 1994. To help sort your way through the complicated maze of overcrowded bankruptcy courts, you need the assistance of knowledgeable legal advocates, with years of experience and demonstrated trustworthiness.

Bankruptcy-just the sound of it evokes strong feelings in most people. Although filing for bankruptcy is rarely anyone's first choice when trying to cope with overwhelming debt, the decision to file for bankruptcy can be the right one when made with full awareness of all its consequences.

Debtors considering bankruptcy must bear in mind that filing for bankruptcy stays on their credit report for up to ten years, making it difficult to get future credit such as mortgages, and that any credit they are extended will probably cost more in terms of interest rates and fees. Debtors should also keep in mind that some debts must still be paid. Accordingly, it is essential to seek the advice of an experienced bankruptcy attorney before making potentially life-altering financial decisions.

Mounting bills can put stress on any family's budget, but when there isn't enough income coming in to pay off those debts, late bill payments are inevitable. If you find yourself facing insurmountable debt and bankruptcy appears to be your only option, it is imperative that you seek the advice of an experienced bankruptcy attorney.

Bankruptcy Clinic, LLC Springfield, Missouri Chapter 7 and Chapter 13 Attorneys

The Bankruptcy Clinic in Springfield, Missouri, offers an effective way to make the collection calls, wage garnishments, repossessions, and possible foreclosure stop--bankruptcy. We will help you restart your financial life by filing either Chapter 13 or Chapter 7 bankruptcy. Once you have filed, there is an automatic stop to all actions against you by your creditors, so the calls must cease. While recent law changes have made it more difficult and expensive to file, most people who qualified under the old laws qualify now. Call ( 417) 8NO-DEBT if you need relief from your mountain of debts.

If you need help to stop the collection calls, contact one of the Southwest Missouri bankruptcy lawyers at the Bankruptcy Clinic in Springfield, Missouri, at ( 417) 8NO-DEBT to schedule a free initial consultation.

The attorneys at the Bankruptcy Clinic--www.8NoDebt.com or (417) 8NO-DEBT--in Springfield, Missouri (MO), provide debt relief to communities in Southwest Missouri, including, but not limited to, Branson, Rogersville, Strafford, Battlefield, Lebanon, West Plains, Buffalo, and Bolivar.

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Bankruptcy - An Overview

Bankruptcy is a legal vehicle that provides relief to individuals and businesses in serious financial trouble and protects their creditors to the extent possible. Generally, the bankruptcy process assesses the debtor's assets and liabilities and provides a structure within which the debtor is allowed to keep some property and ordered to satisfy as many eligible debts as possible, according to an order of priority established by law. Remaining debts are discharged, except those of certain types, like domestic support orders, debt obtained by fraud and most tax debt.

The traditional stigma of bankruptcy has faded and been replaced by the view that it is a fresh start after a time of trouble. Most bankruptcy debtors have experienced unexpected and extreme financial shock, such as that caused by sudden events such as job loss, business failure, death, divorce or illness.

In such cases, filing bankruptcy may be the right answer. If you are facing serious financial challenges, it is very important to seek the counsel of an experienced bankruptcy attorney to help you to assess your legal options.

Consumer Bankruptcy

When an individual falls desperately behind in his or her debt payments, one option may be to declare bankruptcy, a legal proceeding in a federal bankruptcy court that relieves the debtor of some or all of his or her debts. While bankruptcy may not be the best option for everyone, in the right situations, it can provide people with a fresh start. A lawyer experienced in bankruptcy law can advise you as to whether bankruptcy may be the right move for you.

Commercial Bankruptcy

Like a consumer, a business sometimes finds itself in the uncomfortable position of being unable to pay its debts. One solution is to file for bankruptcy, a legal process in federal bankruptcy court that releases the business from the obligation to pay all or some of its debts. A lawyer experienced in bankruptcy can advise business owners about whether bankruptcy is right for them.

Credit Counseling Requirement in Bankruptcy

In 2005, Congress passed and the president signed the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), a bankruptcy reform law. One of the new requirements BAPCPA imposes on a new bankruptcy debtor is to receive credit counseling from an approved credit counseling agency before the bankruptcy filing. A lawyer experienced in consumer credit and bankruptcy law can help educate debtors about these new counseling requirements.

Surviving the Emotional Effects of Bankruptcy

No matter what circumstances ultimately led to filing bankruptcy, both the practical and the emotional impact on the debtor will be enormous. Confronting the emotional and psychological issues surrounding bankruptcy and reaching an understanding and acceptance of the situation are essential to rebuilding and maintaining a successful financial life. An experienced bankruptcy attorney can guide a debtor through the complicated legal, financial and emotional maze of bankruptcy and steer him or her in the right direction for the future.

Bankruptcy Resource Links

American Bankruptcy Institute Consumer Corner
General information regarding consumer debt and bankruptcy.

Legal Information Institute
A bankruptcy overview from Cornell Law School, including links to state, federal and other sources.

FindLaw Guide - U.S. Bankruptcy Courts
Links to US Bankruptcy Court Web sites.

Official Bankruptcy Forms
From the Administrative Office of the US Courts.

AnnualCreditReport.com®
Official Web site where consumers can obtain free credit reports from the three national credit-reporting companies.

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