Many Kentucky residents struggle under the staggering weight of overwhelming debt. Debt can come from many sources, particularly if you have had an unexpected life event that sets you back. Medical debt, loss of income and student loans are all things that make it hard to make ends meet and keep food on the table. For many, bankruptcy is the best option, but what are the advantages of filing for bankruptcy?
According to Consumer Affairs, if you file for bankruptcy, it is true that you wipe away your debt. This provides peace of mind and debt collectors will no longer be calling you regularly. Filing provides you with a fresh financial start and allows you to identify the problems you made the first time so you can avoid them the second time.
Bankruptcy also gives you the chance to start rebuilding your credit score. Credit is involved in almost every aspect of your life, from renting a home to applying for a cell phone plan. Those with better credit have more flexibility and lower interest rates. Clearing your debt and starting fresh guarantees that you can begin the rebuilding process rather than digging in deeper.
One other benefit is that you will not have to drain other sources to cover debts you will eventually need to eliminate. Many rely on their retirement funds or Social Security to pay off debts, meaning they have nothing to live on at retirement time.
While there are disadvantages to filing for bankruptcy, some do not have any other choice. For those who need a path to get them out of debt fast, bankruptcy is often the best option.
This information is for educational purposes and should not be interpreted as legal advice.