Whether to file or not file for bankruptcy in California is a very personal decision. Chapter 7 and Chapter 13 are both consumer bankruptcy options versus Chapter 11, which is for businesses. If you have a significant amount of debt and cannot continue making loan payments while also trying to pay utility bills and buy groceries, bankruptcy may be the right option for you. Depending on the option you choose, you may have more time to make payments, lower existing payments or not have to continue repaying at all.

According to Consumer Affairs, the bankruptcy benefit that encourages many individuals to file is that it wipes out debt. It gives you the time and space to start over and plan for your future. The sooner you get started, the sooner you can begin rebuilding your credit.

Chances are, bill collectors call and harass you, causing stress. Once you file for Chapter 7 or Chapter 13, the calls should stop. It is illegal for them to demand payments from you. If credit card purchases were a weakness, bankruptcy helps by ridding you of them. You can begin developing responsible spending habits.

Although bankruptcy may be the best option, many people try to catch up and regain control of their finances. They use retirement funds, social security and other protected assets, often resulting in huge fees. This often drains finances even further and causes additional money stress. Filing Chapter 7 or Chapter 13 is not uncommon. However, it is critical to understand which option is right for you. There are also other debt-relief options. They may meet your needs better. Visit our webpage for more information on this topic.