If you're struggling with debt, filing for bankruptcy may be your best course of action. Take note, though, that this debt relief does not apply to everyone. An experienced bankruptcy attorney can help you understand the process and consequences. They will advise you to carefully weigh your options before making a final decision. Below is more information to know when it comes to bankruptcy. 

What Factors Do You Need to Consider?

Certain circumstances can make bankruptcy a sensible solution for your debt problems. These situations include creditors suing you and risks of repossession or foreclosures. Filing for bankruptcy will protect you from falling further into debt, and is a step closer to financial recovery. This option allows you to have a fresh start financially.

Many individuals file either Chapter 7 or Chapter 13. You will benefit from a Chapter 7 bankruptcy if you have a large amount of unsecured debt, such as medical bills, credit card balances, business liabilities, and personal loans. Except for your home, car, and other exempted assets, the rest of your properties will be used to pay off your creditors. 

If you’re not qualified for Chapter 7, you can file under Chapter 13 and take advantage of a debt repayment structure. Be sure to consult with a reliable bankruptcy attorney so you can get help in filing under the right chapter.

How Soon Can Your Credit Score Recover?

Although bankruptcy can help you get rid of several types of debt, you will have to deal with its consequences on your credit score. A low rating can affect your credit card limits and eligibility for a mortgage and other loans. If you file under Chapter 7, your credit report penalty can last up to 10 years from the discharge date. For a Chapter 13, the penalty can last for up to seven years. A bankruptcy attorney will help you identify financing options available to you after your credit score drops.

Bankruptcy can provide financial relief. Mark O. Grater Attorney at Law is an experienced bankruptcy attorney in Groton, CT, who provides his clients with the best possible resolution to their legal challenges. Attorney Grater has over 30 years of legal experience and has helped many people control their finances, relieve debt, and get a fresh start. Call (860) 449-8059 or visit his website to schedule a consultation.