There are likely many reasons a person may acquire a significant amount of debt, including overspending, the cost of medical treatment or any other host of unforeseen financial emergencies that must be dealt with. While some Louisiana residents may be able to easily pay off these debts, that may not be the case for others. For those who have trouble paying, Chapter 7 bankruptcy may be the solution.
When people amass a large amount of debt, they may feel hopeless and want to just walk away from it all. Doing so would cause more problems than it would solve, however, and those in debt could be sued and face wage garnishment. Creating a debt management plan might be helpful in some situations, but this could take five or more years to complete. Another option debtors could consider is bankruptcy.
Chapter 7 bankruptcy can give those in debt a fresh start. After filing, a person's assets are completely liquidated, and their debts are placed under an automatic stay. This means that creditors can no longer request payment from those who file. This form of bankruptcy also typically takes much less time to complete than a long-term payment plan.
Anyone interested in learning more about Chapter 7 bankruptcy may consult an experienced Louisiana bankruptcy attorney for more information. An attorney could assist a client by assessing his or her particular situation and determine whether bankruptcy would be beneficial. Being aware of all possible debt relief alternatives could be the first step to becoming financially stable again.
Source: Los Angeles Times, "What to do about heavy credit card debt", Liz Weston, April 9, 2017