Five Reasons Bankruptcies Are Filed
People file bankruptcy for many unique reasons. Very few people file bankruptcy when they can pay their bills. The bankruptcy changes made in 2005 prevent this from occurring. Here are the top 5 reasons people actually file bankruptcy:
Medical Bills
Recent illness or an unfortunate accident can ruin a family’s finances in short order. Lack of insurance increases this risk. Missing work due to illness can impact family finances even further. Which leads us to the next popular reason people file bankruptcy.
Job Loss
Job loss and layoffs can put people in a financial disaster quickly, particularly if they were living paycheck to paycheck while working. Unemployment benefits don’t compare to previous earnings and only last a set amount of time.
Stop Foreclosure
Filing a chapter 13 bankruptcy is often the last recourse to catching up on missed mortgage payments and stopping foreclosure. Filers can include overdue mortgage payments and legal fees into the bankruptcy repayment plan, permitting filers to keep their home and create a feasible payment plan.
Stop Wage Garnishments and Repossessions
Filing a chapter 7 bankruptcy can stop wage garnishments immediately. If your car or other property is at risk of being repossessed, by creating a payment plan in a chapter 13, you can stop the repossession.
Stop Creditor Harassment
A “bankruptcy stay” is entered when you file, making it against the law for creditors to contact you. Phone calls stop immediately giving you time to breathe and get your finances in order.
The stigma associated with bankruptcy is no longer apparent in today’s World. Since unemployment rates are rising due to the economy right now, more and more people will be filing bankruptcy.
Guest Article Provided By: BankruptcyFormProcessing.com where you can find more information on filing bankruptcy and DoItYourSelfBankruptcyForms.com where you can find free bankruptcy forms.
