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Lafayette Bankruptcy Law Blog

Chapter 7 bankruptcy could benefit struggling individuals

Waking up every day with financial troubles hovering can be stressful and exhausting. Many Louisiana residents may think that they must struggle along slowly and hope that their outstanding debts do not finally have dire consequences. However, that does not have to be the case. For many, Chapter 7 bankruptcy could provide numerous benefits.

If one of the reasons that individuals are struggling financially relates to a lack of income or a very low income, Chapter 7 could still help. This avenue is available to those who do not have the money to pay back their debts. However, it does involve the liquidation of assets to pay off certain creditors and allows for other debts to be discharged entirely. As a result, parties would likely have the ability to focus more on buying necessities rather than paying off debt.

Bakery seeks debt relief for outstanding liabilities

Owning a business is often a rewarding experience, but it can also be financially challenging. In many cases, small businesses struggle to keep up with the financial demands, and it is not unusual for substantial debt to accumulate. Some struggling Louisiana businesses may even turn to bankruptcy for debt relief.

This type of situation recently affected a company in another state. Reports indicated that the owners of a bakery closed their two locations due to financial issues. The company has less than $50,000 in assets, and the Internal Revenue Service is listed as one of the creditors with a $68,000 federal tax lien. It was noted that the bakery's debts land between $50,000 to $100,000. In addition to the business bankruptcy, the owners have also opted for personal bankruptcy.

Yes, you can rebuild excellent credit after a bankruptcy filing

Far too many people struggling with overwhelming levels of debt choose to put off filing for bankruptcy out of concern for how it will impact their credit. There's a common myth about bankruptcy that it will keep you from securing credit in the future.

While it is true that a bankruptcy on your credit report will impact your credit worthiness for some time, it will not be a permanent blemish. Also, simply filing for bankruptcy will not prevent you from securing new lines of credit in the future. Taking the right steps to rebuild your credit after you file for bankruptcy can help ensure that you have a healthy financial future ahead of you.

Bankruptcy may help those with medical bills find debt relief

Suffering from a medical emergency can be a major setback for any Louisiana resident. A person may have to face long recovery times, medical treatments and pain associated with the condition, and the situation could also lead to financial hardships. Lost wages could result from time away from work, and medical bills may continue to accumulate. Soon, someone in this type of predicament may need serious debt relief.

In particular, many people consider bankruptcy as a way to address their medical debt. While a specific "medical bankruptcy" does not exist, Chapter 7 or Chapter 13 could help address outstanding balances associated with medical care. Of course, either of these proceedings would involve all of one's debts. This means that someone looking to address only their medical debt and not credit card debt or other liabilities would not find that option with bankruptcy.

Retail chain Sears files for Chapter 11 bankruptcy

Businesses can be successful for years, and due to changes in the economy, competition or other factors, they can suddenly find themselves facing significant downturns. In these cases, financial issues can cause a once-booming company to struggle significantly. In fact, Chapter 11 cases are not uncommon when this type of scenario strikes.

Louisiana residents may be interested in a bankruptcy petition that was recently filed by retail giant Sears Holdings. Reports indicated that the company has billions of dollars in outstanding liabilities. The bankruptcy filing came after a debt payment for $134 million came due, and the company could not pay. The company hopes to stay in business despite the financial struggles they are currently facing. However, 300 of their stores have already closed.

Credit card rewards may leave consumers needing debt relief

No Louisiana resident wants to find him or herself overwhelmed by serious debt. Unfortunately, this type of situation can quickly overtake a person's finances. In some instances, individuals may not realize that they have been duped into a less-financially sound decision when it comes to credit card use. As a result, debt relief options may be needed.

One of the biggest draws credit card companies are utilizing involves offering rewards to consumers. However, many of these rewards may not be as beneficial as the companies want individuals to believe. For example, American Express allows consumers to earn airline miles when they use their cards, and they also allow consumers to use points that they have not yet earned. Individuals can purchase an airline ticket essentially using borrowed points, and then they must earn the necessary points within the next six months.

Could bankruptcy help businesses seek debt relief?

Running a business comes with its financial ups and downs. Unfortunately, some Louisiana businesses may struggle more often or face a sudden blow to their operations. In these cases, it is possible that bankruptcy may be a needed option in order to find debt relief.

If the situation has become too much to overcome, businesses could file for Chapter 7 bankruptcy. This options involves liquidating business assets in order to repay creditors, and in the end, the business will have to close. Sole proprietors tend to utilize this form of bankruptcy more often than other types of business entities. However, limited liability companies, corporations and partnerships could also file for Chapter 7 if they deemed it necessary, but only sole proprietors can obtain a discharge of debt.

Can you discharge all your debt in Chapter 7 bankruptcy?

If you find yourself in a bad financial situation, you may turn your attention to Chapter 7 bankruptcy. As you learn more, you'll come to find that you can discharge some of your debt with the idea of getting your finances back on track and starting fresh.

While there are definite benefits of Chapter 7 bankruptcy, including the ability to eliminate most of your debt, remember this: Some types of debt are immune to Chapter 7 bankruptcy, meaning that you'll still be responsible for them after your filing.

Considering bankruptcy? Avoid these mistakes

It is common for Louisiana residents and those elsewhere to have a love-hate relationship with their finances. They may love when they have a little extra income or splurge on a treat, but they may also hate the amount of debt they have. For some, their debt may be so consuming that they rarely, if ever, have the chance to buy even a small treat. Fortunately, avenues like bankruptcy may be able to help.

Bankruptcy is a major step when looking for debt relief. While it can allow individuals to get back on track financially, it only works when completed correctly. Parties looking to follow this route need to make sure that they understand all of their outstanding balances. If they do not, they may not disclose all of their debts in their bankruptcy petitions and to the court, which means that the debts cannot be discharged. As a result, the process may not work as intended.

Small debt relief steps may not always help those struggling

Most people in Louisiana and elsewhere accumulate some amount of debt at one point or another. Some individuals may utilize a credit card or have a mortgage loan, and for the most part, they stay on top of their payments. For other parties, their outstanding balances may be much more consuming, and they may have a desire to find the right form of debt relief.

There are many ways that individuals can work toward reducing their debt on their own. They may find it helpful to organize their debt to determine what balances have the highest interest rates and work to pay those balances off first. They could also potentially benefit from having a certain amount set aside from their paychecks each month to go specifically toward their debt.

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Richoux Law Firm, L.L.C.
110 E. Kaliste Saloom Road
Suite 205
Lafayette, LA 70508

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Phone: 337-205-7049
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