Financial stress can happen to anyone during their lifetime. The overwhelming financial burden with no hope of paying it back occurs when a perfect storm of circumstances occurs in a person’s life. It doesn’t matter if it’s unforeseen medical debt, consumer debt, or other loans. In these situations, people will naturally start looking for the advantages and disadvantages of filing bankruptcy. Bankruptcy collection actions are stopped for all active bankruptcies.

All types of bankruptcies can provide relief. Chapter 13 bankruptcies allow a person to pay back their debts with a payment plan they can afford. When approved, all creditors must abide by this arrangement. Other people seek out a Chapter 7 bankruptcy, which allows a person to wipe away most, if not all, of their debts without needing to pay any of them back.

Most people would prefer Chapter 7 bankruptcy, when possible, but each type and what you might qualify for in each state will ultimately determine which solution is best for you. Working with a Chapter 7 bankruptcy lawyer will make sure your paperwork is filled out correctly, so the courts don’t disapprove your requests based on a technicality. Bankruptcy lawyers also provide a shield of protection between you and creditors that may try to skirt the collection rules.

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