Reasons To File Bankruptcy – Stopping And Eliminating Creditors

How Bankruptcy Can Help You Regain Control

Common Causes of Bankruptcy

Having to consider bankruptcy can be a highly emotional, even overwhelming experience. Nobody sets out to get themselves into crushing debt, but for many Americans, this is their reality. Unfortunately, the stereotype is that those who file for bankruptcy are spendthrifts and poor money managers who simply overspent on frivolous items. This is not even remotely close to the actual truth of why most people file for bankruptcy. The reality is that the top three reasons people file bankruptcy are:

  • Loss of a job (loss of income)—Job loss can also mean a loss of health insurance which leaves the unemployed individual particularly vulnerable to large medical bills. 
  • Medical expenses have quickly moved up the list over the past two decades to become one of the primary reasons for bankruptcy filings. Medical problems may also lead to the loss of a job, which can lead to the loss of health insurance. As you can see, this is a delicate house of cards that can come crashing down, leaving people overwhelmed with debt. 
  • The inability to pay a home mortgage is also one of the big reasons for bankruptcy filings. With the steady increase in home prices, the largest portion of most household debt in the U.S. is home mortgages, surpassing credit card debt, car loans, student loan debt, and other forms of debt. Lenders are often guilty of approving buyers for a larger loan than they can realistically afford to pay, then when the buyers are unable to make their mortgage payments—especially after the loss of a job—an untenable situation results. 
  • Other reasons for bankruptcy filings include overspending, particularly when using high-interest credit cards, providing financial assistance to family members, burdensome student loan debt, or costly legal fees associated with divorce or other legal matters. 

Bankruptcy lawyers have the experience, knowledge, and skills necessary to help you get your financial future back on track. When you choose a Simon Fitzgerald bankruptcy lawyer, you can rest easy, knowing you have someone watching your back who cares about the outcome of your bankruptcy. 

Financial difficulties can be overwhelming, but bankruptcy offers powerful tools to help you regain control of your life. Here’s how:

  • Stop Foreclosures and Sheriff’s Sales: The automatic stay with filing for bankruptcy immediately halts foreclosure proceedings and sheriff’s sales. If you’re facing the loss of your home, Chapter 13 bankruptcy allows you to propose a repayment plan to catch up on your mortgage arrears, enabling you to retain your home.
  • Stop Wage Garnishment: Wage garnishment can worsen a problematic financial situation. Filing for bankruptcy stops wage garnishments instantly through the automatic stay. Both Chapter 7 and Chapter 13 provide mechanisms to eliminate or restructure the underlying debts, protecting your income for the future.
  • Stop Car Repossession: Losing your vehicle can be a significant setback. Bankruptcy’s automatic stay stops repossession efforts, and Chapter 13 allows you to restructure your car loan, often reducing the balance and interest rate, enabling you to keep your car.
  • Stop Creditor Harassment: Constant calls and letters from creditors can be incredibly stressful. The moment you file for bankruptcy, the automatic stay ends this harassment, giving you the space to breathe and plan your financial recovery.
  • Stop and Eliminate Payday Loans: Payday loans can trap you in a cycle of high-interest debt. Bankruptcy stops this cycle through the automatic stay, and both Chapter 7 and Chapter 13 can discharge or restructure these debts, freeing you from the payday loan trap.
  • Stop Eviction: If you’re facing eviction, bankruptcy may provide a lifeline. The automatic stay can temporarily halt eviction proceedings, and Chapter 13 may allow you to catch up on past-due rent, helping you keep your home. Timing is crucial, so acting quickly is essential.

Bankruptcy is not merely a last resort; it’s a strategic legal tool that can empower you to stop adverse actions, restructure your debts, and eliminate burdensome obligations. Whether through Chapter 7’s swift discharge or Chapter 13’s structured repayment, bankruptcy offers a path to financial stability and peace of mind.

Why Filing Bankruptcy Could Be Your Best Option

person looking through file folderMany circumstances in life could create immense debt. Most residents in Louisiana are one injury, medical diagnosis, personal loss, or another tragedy away from financial hardship. The debt burden can feel insurmountable, leading to stress, anxiety, and hopelessness.

At Simon Fitzgerald LLC, we understand the complexities of financial challenges and are here to help you navigate them. No matter how the debt began, we will help you find the best way to recover. Here’s why filing for bankruptcy could be your best option:

  • Immediate Relief Through Automatic Stay: As soon as you file for bankruptcy, an automatic stay goes into effect, halting all collection efforts, foreclosures, wage garnishments, and creditor harassment. This provides immediate relief and breathing room to assess your financial situation. For more information about the automatic stay in Chapter 7 and Chapter 13, visit the S. Courts Bankruptcy Basics.
  • Eliminate or Restructure Debt: Bankruptcy allows you to either discharge qualifying debts entirely (Chapter 7) or restructure them into a manageable repayment plan (Chapter 13). This can provide a fresh start, free from the overwhelming debt burden.
  • Protect Your Assets: Bankruptcy laws include exemptions that protect essential assets like your home, car, and personal belongings. You don’t have to lose everything to get back on your feet.
  • Rebuild Your Credit: While bankruptcy does impact your credit initially, it also stops the downward spiral of missed payments and mounting debt. With time and responsible financial behavior, you can rebuild your credit score.
  • Personalized Legal Guidance: Our experienced attorneys at Simon Fitzgerald LLC will provide personalized guidance tailored to your unique situation. We’ll help you understand your options, make informed decisions, and confidently navigate the legal process.
  • Emotional Relief: The emotional toll of debt can be devastating. Bankruptcy provides a legal pathway to regain control of your financial life, alleviating stress and allowing you to focus on your future.
  • Affordable Solutions: We offer competitive pricing and transparent fees, ensuring that bankruptcy is an accessible solution for those who need it. Our initial consultation is free, allowing you to explore your options without financial commitment.
  • A Proven Path to Recovery: Bankruptcy is not a sign of failure; it’s a strategic tool millions use to regain financial stability. It’s a proven path to recovery, providing legal protection and a structured process to turn a bad situation around.

Benefits Of Bankruptcy

person on phone

  • Stop Creditor Harassment: Constant reminders about unpaid debts can be overwhelming and stressful. Filing for bankruptcy immediately stops harassing calls and letters from creditors, giving you the peace of mind to focus on your financial recovery. You may not even realize to what extent these constant creditor calls have diminished your mental health and your life. Once you no longer fear the phone ringing, you will know just how intrusive those calls actually were. 
  • Freeze Foreclosure and Repossession: Losing essential property like your home or car can be devastating. Bankruptcy can halt foreclosure and repossession processes, allowing you to prioritize keeping the items you need for daily life. The threat of losing your home or vehicle is disturbing at any time, but if you have a family, it is even more frightening and overwhelming. Of course, you want to keep a roof over your family’s head, and in most households a vehicle is crucial for getting to and from work, taking children to school, and running necessary errands like grocery shopping. If you are facing foreclosure or repossession, Simon Fitzgerald can help stop the process, giving you some breathing room to make necessary decisions. 
  • Find a Solution to Debt: Bankruptcy offers a unique opportunity to reorganize or eliminate eligible debts. Whether through Chapter 7’s debt discharge or Chapter 13’s structured repayment plan, bankruptcy can provide a fresh financial start. There is really no better feeling than shedding the constant black cloud that has hung over your head for months, possibly even years. Getting a second financial chance can make all the difference in your future. 
  • Protect Your Wages: If you’re facing wage garnishment, bankruptcy can stop this process, ensuring you retain your hard-earned income to support yourself and your family. Wage garnishment is just as frightening as foreclosure and repossession. Without your full paycheck, you are unable to pay for necessary items for your family—including food, transportation, and a roof over their heads. 
  • Resolve Tax Debt: Certain tax debts may be managed or discharged through bankruptcy, relieving this often overwhelming financial burden. Although only delinquent income taxes can be resolved through bankruptcy, this is the primary type of tax debt most Americans have. The penalties and interest associated with tax debt can grow exponentially, causing you to wonder if you will ever be out from under that debt. Bankruptcy can make that a possibility for some tax debts, so it’s important to talk to your bankruptcy attorney about your debt associated with unpaid taxes.
  • Legal Expertise and Support: Filing for bankruptcy can be complex, but you don’t have to navigate it alone. Our skilled lawyers at Simon Fitzgerald LLC will guide you through every step of the process, ensuring you understand your options and make informed decisions.
  • Emotional Relief and Empowerment: Beyond the financial benefits, bankruptcy can alleviate the emotional weight of debt, empowering you to take control of your financial future with confidence and optimism. As noted, the mental and emotional benefits of getting a fresh financial start simply cannot be overstated. Debt is a constant, nagging problem that is never far from your mind. You may have been living in fear that you would lose your home or car, that your wages would be garnished, or that threats from creditors would be a constant way of life in your future.
  • Tailored Solutions: Every financial situation is unique, and our experienced attorneys will work closely with you to develop a personalized bankruptcy strategy that aligns with your goals and needs. At Simon Fitzgerald, you are never just “another client” to us. We will listen carefully to your unique situation, and then craft the very best solution for you that is specific to you, your family, and your future.

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What is the Role of Experienced Bankruptcy Lawyers?

There are so many excellent reasons to speak to a knowledgeable bankruptcy attorney from Simon Fitzgerald. Some of those reasons include:

  • After speaking with you about your specific situation, a knowledgeable bankruptcy attorney can tell you whether bankruptcy is your best option or if other debt relief options might be a better alternative for you. 
  • An experienced bankruptcy attorney will handle all the details of your bankruptcy filing, giving you some breathing room to handle other important details of your life. 
  • A highly skilled bankruptcy lawyer has negotiation skills that allow them to negotiate a settlement or repayment plan with your creditors if that is a better option than bankruptcy. 
  • Your attorney can help you determine whether Chapter 7 or Chapter 13 bankruptcy is right for you. 
  • All the paperwork—and there will be plenty—that accompanies a bankruptcy filing will be taken care of by your bankruptcy lawyers. You can rest easy knowing the paperwork will be filled out correctly and filed promptly.  
  • You will almost certainly be able to retain more of your belongings when an experienced bankruptcy attorney is handling your case. 
  • Your bankruptcy lawyers will act as your legal representative, representing you at the 341 Creditors Meeting and any additional court appearances as necessary.
  • Chapter 13 bankruptcy in particular is extremely complex, making it imperative that you have a knowledgeable bankruptcy attorney who can help you set up a realistic repayment plan and negotiate with the Trustee on your behalf.

Skilled bankruptcy lawyers can help you remain in your home, avoiding foreclosure. Repossession of your vehicle and garnishment of your wages may also be avoided when you have a bankruptcy attorney from Simon Fitzgerald by your side.   

How to Choose the Best Louisiana Bankruptcy Lawyer for Me

Choosing the best Louisiana bankruptcy lawyer is a critical part of the process. As with anything, there are good bankruptcy lawyers, indifferent bankruptcy lawyers, then there are the great bankruptcy lawyers who will be your legal advocate throughout the process, fighting for you, your family, and your future. You may know a co-worker or have a friend or family member who has gone through bankruptcy and may have an attorney referral. Or, you may choose your Louisiana bankruptcy lawyer by going online and looking at the websites of bankruptcy lawyers in your area. At Simon Fitzgerald, we know you have many choices, but we strongly believe that once you have spoken to one of our knowledgeable, compassionate, highly skilled bankruptcy lawyers your choice will be clear. 

Our firm is the oldest bankruptcy law firm in Louisiana. We have helped more than 25,000 Louisiana residents through bankruptcy in the best way possible, with the best possible outcomes. There is simply no substitution for this level of experience and when you add to that our true concern for our clients, we certainly hope you will give us the chance to discuss your situation and present options that can make your life so much better. 

How Simon Fitzgerald Can Help

At Simon Fitzgerald LLC, we’re committed to helping you navigate the complex bankruptcy processes with confidence and expertise. We understand the unique challenges you face, whether it’s stopping foreclosures, wage garnishments, or eliminating payday loans. Filing for bankruptcy can be difficult, but it often provides the relief and fresh start that individuals and families need. We believe everyone deserves a chance to recover and rebuild, and we’re here to provide personalized solutions tailored to your needs, offering compassionate, expert guidance throughout the bankruptcy process. Don’t let financial difficulties control your life; take the first step towards financial freedom and renewed stability by contacting us today.