For many Virginia families, debt is a fact of life. Individuals use loans to purchase homes, buy cars, purchase a new school wardrobe and obtain needed medical treatment. When everything is going well, some debt can be a good thing, but when something happens and the income used to pay outstanding debt is no longer enough, the situation can appear dire. It may be time to review available options, including filing for Chapter 7 bankruptcy.
Under Chapter 7 bankruptcy, many of the individual’s debts can be discharged. This means that the credit card balances, medical bills and other unsecured debts can go away. It is possible that some assets may be sold to cover secured debts, but there are measures in place to protect the individual. Some debts such as taxes and students loans are generally not discharged.
One of the primary concerns individuals express about filing for bankruptcy is the negative impact it will have on their credit score. However, when an individual is in a financial position where bankruptcy is a possible option, the credit score is probably already being affected. Filing for bankruptcy may actually be the first step in reversing the trend and repairing the financial damage.
Once the bankruptcy has been filed, the credit repair process can begin. There are a number of secured credit cards and other resources available to help the Virginia resident begin to reestablish his or her credit score. Filing for Chapter 7 bankruptcy can be a positive step in relieving the overwhelming burden that debt has placed on the individual.