Although the word “bankruptcy” often has negative connotations when uttered in public, the truth is, this option to get out of debt can end up being the best thing you can do to get your financial affairs back in order. There are several benefits that a person can gain from filing bankruptcy, such as:
- Ceases collection calls
- Halts lawsuits & wage garnishments
- Eliminates debt
Do You Want to Save Your Credit Score?
While you may have heard that bankruptcy will hurt your credit score, which it will at first, there is more to the entire process that you may not be aware of. For one, most people who are struggling with debt tend to already drive their credit score way down before they even file for bankruptcy. However, after the bankruptcy court “discharges” your debt once you have sacrificed your bankruptcy agreement, then your credit score will start to rise again.
According to a study from the Federal Reserve Bank of New York, most people’s credit scores are better off within a year of their discharge. The study found that a person’s credit score will significantly decline in the 18 months before filing for bankruptcy, but afterwards, their score steadily rose. In fact, findings from the study revealed that the average credit score for someone who filed Chapter 7 bankruptcy was in the 280 to 850 range. Within six months of the discharge of their Chapter 7 bankruptcy, the average score was 620.3. So if your credit score is already in the low 600s, then bankruptcy might be a good option for you.
Get Advice from an Experienced Bankruptcy Lawyer Today
If you are thinking of filing for bankruptcy because you can no longer keep up with your debt, then please reach out to our legal team at US Legal Group, APC so we can review your situation and answer all of your questions. Our team of compassionate and knowledgeable lawyers is here to explain all of your options and we will ensure your rights are protected throughout the entire process.Call us today at (714) 266-3277 if you’re ready to schedule your consultation with our firm.