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Bankruptcy Law Blog

Thursday, January 16, 2020

The Pros and Cons of Filing for Bankruptcy

Jimmy Fallon does a recurring bit on The Tonight Show where he takes a look at the pros and cons of various topics. Things like dating Britney Spears, graduating from college, and using AirBNB. The pro is usually something serious, and the con is often a joke.

Though Fallon is lampooning the overuse of pro and con lists, they remain a helpful tool. Any Alabamian considering filing for bankruptcy should weigh all of the pros and cons of doing so before making such an important decision. Below is a list of some of the major pros and cons every potential bankruptcy filers should consider.

Pros

  • Filing for bankruptcy will help you pay off or wipe away debts. Debts like credit card debt and healthcare-related debt can be forgiven or discharged.
  • When you file for bankruptcy, all of your creditors must stop harassing you for payment and instead seek payment through the bankruptcy court. Some of them may never get a dime, and they can’t say anything to you about it.
  • You cannot be fired from your job just because you file for bankruptcy. This does not mean you cannot be fired at all while your case is pending.
  • After your case is closed, you get to start fresh. You will be on much firmer financial footing than before you filed your case.

Cons

  • Not all debt is forgiven when you file for bankruptcy. Tax debt, back child support payments, and student loan debt are just some of the many types of debt that it are nearly impossible to wipe away, aka discharged.
  • Your bankruptcy filing will remain on your credit report for up to ten years. This can make it difficult for you to access new credit once your case is closed. If you need to get a loan to buy a car or a house in the near future, filing for bankruptcy could make it difficult to get financing.
  • It may be difficult for you to get certain jobs if you have ever filed for bankruptcy. Jobs in the financial sector and government jobs often bar applicants with what they consider risky financial pasts.

This Isn’t a Joke

Deciding whether to file for bankruptcy is not a joke. It is a serious decision that is going to have a big impact on your life. Looking through the pro and con list above may help you make your decision, but it is not an exhaustive list of all the factors you should consider. In addition, your individual circumstances mean some factors will matter more to you than others.

If you want help deciding if filing for bankruptcy is right for you, the best thing you can do is talk to an experienced bankruptcy attorney. The attorneys at our firm can help you figure out if bankruptcy is right for you, and lead you through the bankruptcy process. Contact our office today to request an initial consultation.


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Padgett and Robertson assist clients with Bankruptcy, Personal Bankruptcy, Consumer Bankruptcy, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy and The New Bankruptcy Law in Mobile, Alabama and throughout southern Alabama. Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”



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Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”