In Arkansas and in all other jurisdictions, the federal bankruptcy remedy is a proven way to wipe out large accumulations of consumer debt. However, an individual or married couple who are thinking about filing a bankruptcy should always first obtain a consultation with a seasoned bankruptcy attorney. Professionals who practice in this area are well-equipped to tell you whether you qualify for debt relief, and then whether such a move is advisable under your particular circumstances.
Bankruptcy counsel can advise if some other remedy is feasible. For the most part, however, making payment plans with creditors in private agreements outside of a bankruptcy proceeding is generally a frustrating dead end street. That's mainly because the payments are often too high for a debtor's budgetary means, and when the debtor misses payments the creditor usually acts quickly to re-establish intense collection efforts. The consumer must also beware of scams and unscrupulous so-called debt relief or consolidation programs.
In fact, the funds invested into a failed loan consolidation agreement with creditors could have been used for the expenses of filing a bankruptcy and forever wiping out the bulk of a person's debts. That's a tough lesson for some persons to learn, but on the other hand 'better late than never' is also a consideration that usually makes sense. In fact, there are many reasons for an individual or married couple to want to file bankruptcy. For example, here are a few possible remedies:
- Stop foreclosures, repossessions and sheriff's sales.
- Get a fresh start with all of your unsecured debt erased and wiped out.
- Save your home in a Chapter 13 by using a three to five-year payment plan.
- Stop wage garnishment, harassing phone calls, and creditors' lawsuits.
- Prevent a utility from cutting off your service or compel a utility to turn it back on.
A consumer in Arkansas or in any other jurisdiction can acquire many options by filing a bankruptcy under federal law. These options and remedies are best learned by consultation with bankruptcy counsel prior to deciding whether to file. There are also several important decisions that must made prior to filing, such as whether to file a Chapter 7 or a Chapter 13.
Source: Capital Gazette, "Personal Finance: Is a bankruptcy filing right for you?", Vanessa Bright, Oct. 2, 2014