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Does Filing Bankruptcy Really Provide A Fresh Start?

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If you are suffering from significant debt and have considered filing bankruptcy, you have probably heard that it will give you a fresh start. Our Fort Lauderdale bankruptcy lawyers have even said it many times. Is it really true, though? In short, yes, it is. However, before you file, it is important that you know what that means so you can understand what you can really expect.

How Does Filing Bankruptcy Provide a Fresh Start?

After filing bankruptcy, your debts are discharged, allowing you a fresh start to rebuild your credit and manage your finances in a way that does not place a strain on your life. This is particularly true with Chapter 7 bankruptcy, in which you can have most, if not all, your unsecured debt discharged.

Chapter 13 does not work the same, but it can still provide you with a fresh start. During this type of bankruptcy, a repayment plan is established that allows you to repay your debt over a certain period of time. The timeline of that plan is usually fairly long, making payments more affordable for you and providing the fresh start you need.

Bankruptcy as a Fresh Start Under the Supreme Court

The idea of bankruptcy as a fresh start is much more than just a slogan or gimmick. In 1934, the US Supreme Court defined bankruptcy as a fresh start. In a ruling, the highest court stated that bankruptcy provides a new opportunity in life unconstrained by the pressures of preexisting debt. The fresh start bankruptcy provides will allow you to discharge the majority of your debt. You will also learn money management skills and new credit skills that will help you move forward.

What a Fresh Start Is Not

Although bankruptcy can provide a fresh start, it is important to realize it may not eliminate all of your financial woes. Bankruptcy May  not eliminate all types of debt so afterwards you may still be left with tax debt, child support, student loans, and other types of court-ordered debt.

It is also critical to understand that filing bankruptcy does not mean that your credit report is automatically repaired. The debt still exists. You are just no longer legally liable for paying it. This means it will still appear on your credit report. Even though creditors can no longer pursue you for the debt, you could be denied additional loans and credit.

Call Our Chapter 7 Bankruptcy Lawyers in Orlando for Your Fresh Start

If you are suffering from debt and think bankruptcy might be right for you, our Orlando Chapter 7 bankruptcy lawyers at Anderson & Ferrin, P.A. can help. Our seasoned attorneys have the experience and familiarity with the bankruptcy system to advise on which type is right for you and give you the best chance of a successful outcome. Call us now at 407-412-7041 or contact us online to schedule a free initial consultation with one of our knowledgeable attorneys and learn more about your legal options.

Sources:

law.cornell.edu/uscode/text/11/chapter-7

uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-13-bankruptcy-basics

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