Bankruptcy May Be Costlier Than You Think

Long-Term Costs of Bankruptcy Near LakelandWhen you have a bankruptcy attorney file bankruptcy for you near Lakeland, you’ll be able to either discharge or restructure your debts so that you’ll have additional time to repay any debts that you owe. Not only will you still owe money, but filing for bankruptcy comes with a cost of its own. This cost depends on the type of bankruptcy you file and whether you decide to hire a bankruptcy attorney (which is something you should do). There are also long-term costs to be considered. Here are what some of these costs are.

Chapter 7 (a.k.a., Liquidation Bankruptcy)
Typically, Chapter 7 bankruptcy is recommended by bankruptcy attorneys for people near Lakeland who have an income that’s below their state’s median. When you file bankruptcy under this chapter, you must sell your assets to repay your debts. To get started, though, you’ll need to pay a $245 filing fee. Once you’ve filed, your lender can still move forward with foreclosure or repossession of any unsecured debts (e.g., mortgage, auto loan).

Chapter 13
When you file bankruptcy under Chapter 13, you’ll pay more, but unlike with Chapter 7, you won’t have to sell off most of your belongings. Instead, your financial life and debts will be reorganized so that you can have a fresh start while keeping some of your property (e.g., your house). The filing fee for Chapter 13 is the same as when you file bankruptcy under Chapter 7 near Lakeland; it’s $245.

With Chapter 13, your bankruptcy attorney will work with you and the courts to extend the amount of time that you have to repay your creditors. Usually, this is extended to a period of three to five years. If you make all of your payments under this plan, your unsecured debts will be discharged. To do this, you’ll be responsible for working with a trustee who’s been appointed by the court near Lakeland. They’ll help ensure that you make the required payments to your creditors. You’ll be responsible for paying them a commission of up to 10% when you file bankruptcy this way.

Long-Term Costs of Bankruptcy Near Lakeland
While there’s an immediate cost that you’ll pay when you file bankruptcy, there’s also the long-term impact on your financial life that you’ll have to deal with. You should also know that your credit score is going to take a large hit since bankruptcy stays on your credit report for 7 – 10 years. During this time, you’ll have a hard time qualifying for a new loan. Even if you’re able to get a new loan, you’ll be hit with a higher interest rate than someone who has good credit. Unfortunately, this will increase your loan’s cost significantly. Furthermore, there are some landlords and employers who check your credit when you apply for an apartment or job. When you have a bankruptcy on your credit report, your chances of obtaining these things could be harmed.

Bottom Line
When you’re overcome by a large amount of debt, bankruptcy will offer you an opportunity to gain control over your finances once again. However, you must understand that bankruptcy isn’t free. You have to pay for court fees and the cost of your bankruptcy attorney. Additionally, there are long-term financial impacts that you must be prepared to deal with.

Weller Legal Group, near Lakeland, Florida, is a reputable law firm with a bankruptcy practice. They’ve assisted several clients in navigating the difficulties of filing for bankruptcy thanks to their knowledge and experience. They’re the go-to bankruptcy attorneys in the area. If you’re thinking about declaring bankruptcy and need assistance with the procedure, contact them today.

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