Clients come to me feeling that their lives are falling apart. Debts are a major cause of stress in marriages. My clients often feel like failures because they are unable to meet their obligations.
Sometimes there are non-bankruptcy options available. A bankruptcy will go on the debtor's credit report for ten years. I always try to remember to tell my clients that bankruptcy should be a last resort.
When I see young clients without much debt, I recommend that they not file bankruptcy. I tell them that bankruptcy will cause them to pay more when they finance cars and will make it harder for them to get approved for a home loan and if they do buy a house they will pay a higher interest rate because of the bankruptcy filing. Judgments can be paid off and cancelled. The bankruptcy cannot be removed from the credit report.
When I see older clients whose income is from social security or some other source that can't be seized, I try to find out if they have any assets that can be seized or that a judgment would attach to. If they do not have any land or seizable assets, I will explain that they are judgment proof and that there is nothing that the creditors can do to make them pay their debts. Sometimes the clients will still choose to file for bankruptcy to put an end to the calls from creditors.
The slogan on the Liberty Bell, "Proclaim liberty throughout the land" comes from the Old Testament book of Leviticus, Chapter 25 verse 10 and refers to liberty from debt. Under ancient Jewish law all debts were legally erased and were no longer owed every seven years. In addition, every fifty years any land that was sold would be returned to the seller's family. The year that this occurred was known as the jubilee. From this word we get the word jubilant which means happy which is what our clients often feel when their debts are discharged.
The founding fathers of this country felt that it was advisable to provide for bankruptcy in the United States Constitution. Many of the heroes of the Alamo were in Texas because they were fleeing debts in other states. Many clients will feel guilty about having to file bankruptcy and not paying some or all of their debts. The bankruptcy laws require you to list all of your debts in your schedules. The bankruptcy laws also allow you to pay any debts that you wish to pay in full or in part.
In a perfect world all debtors would pay all of their debts in full. In a perfect world creditors would not feel the need to charge 29.99% on credit card debts, 36% on consumer debts and over 200% on pay day loans. Because we are not perfect, Jesus told us to pray in the Lord's Prayer asking God to forgive us our debts as we forgive our debtors. The bankruptcy laws help the unfortunate debtors, the least fortunate among us, who need our assistance as they seek to obtain the fresh start that comes with a Bankruptcy discharge.
An added bonus of Chapter 13 practice is that we can frequently help clients keep their homes, cars, and other assets that they would lose without our help. So don't let anyone make you feel guilty about seeking help with your financial problems.
When is Bankruptcy Appropriate?
1) If you are about to lose your home and you can afford to resume making payments and can afford to pay the missed payments over time.
2) If you have been sued and you cannot afford to be garnished.
3) If you are about to lose your car.
4) If you cannot meet your current obligations but you could pay your bills if they were consolidated.
5) If you can't stand the stress of not being able to pay your bills.
Please call me if you fit into one of these categories. Call 337-494-1023 and schedule your free initial consultation.
