The Benefits & Limitations of Filing for Bankruptcy
One of the most common bankruptcy questions we receive is simply what bankruptcy actually provides, as well as what it is not able to do. Granted, that’s a long and potentially complex answer, but by understanding some of the basic can and cannots, you’ll be in a better position to understand the best potential next step for yourself.
There are many benefits of filing bankruptcy in Maryland, along with specific positive outcomes. Immediately after filing, you’ll be able to take advantage of the Automatic Stay, which provides you with instant relief by stopping harassing phone calls, collection efforts, law suits, garnishments, and foreclosure actions.
Beyond that, most of your debts will be able to be discharged. Not all debts can be discharged, however. Certain secured creditors will retain rights to the debt, although, if maintaining that property is the goal, then generally payment plans or alternatives can be achieved.
Another cannot for bankruptcy is that it’s not able to discharge debts including child support or alimony, and in most cases, student loans. Further, any debts accumulated after you file cannot be discharged.
In the realm of what bankruptcy can do, filing bankruptcy does enable you to stop foreclosure on your house, enabling you to catch up on payments and get back on track. You’ll also be able to stop wage garnishment, creditor harassment, resolve back taxes, and challenge claims of potentially fraudulent creditors.
In addition to your home, it is possible to maintain certain other property. This will depend on the exemptions you pursue, and the type of bankruptcy chapter you file. As with your home, if you owe payments on a car you can generally establish a payment plan to get caught up and maintain your vehicle.
Of course, all of this has been a general overview. There are many wonderful benefits of filing for bankruptcy in Maryland or any other location, but it’s not an instant cure-all, and it isn’t always the best choice for each person.
If you have further questions, then feel free to read out bankruptcy FAQ, or to reach out and schedule a free consultation to discuss matters with the attorneys at our Maryland bankruptcy law offices.