Filing Bankruptcy Should Not Be Such a Horrible Experience

With the recent economic downturn, loss of jobs, high commodity prices and mortgage crisis, many individuals are facing financial difficulties. Filing bankruptcy is a serious financial decision, and although it should never be the first option, many now realize it may be the best option for them and their families.

This personal bankruptcy story was posted on the Internet on March of 2011, “I know that you have strong feelings about bankruptcy, as do I. I’m a bankruptcy paralegal and no one that I have ever worked with who is considering filing for bankruptcy does so because they want to. Most people only consider it after they have had a “life altering” experience including: divorce, loss of job, accident, or a major medical crisis.”

The paralegal is right. Filing for bankruptcy is not a sign of weakness, laziness, immorality, or dishonesty. Financial difficulties can happen for a variety of reasons including: divorce, catastrophic event, property foreclosure, late bill payment, loss of income, health problems, poor business decisions, bad timing, bad advice, or a poor economy. Many of these events are beyond our control.

Counter points were expressed on the same website, “I live in California, and bankruptcy is becoming more and more popular. There seems to be a myth going around that it clears away all of a filer’s debts and obligations. Growing up, bankruptcy was a bad word. It was something that was avoided. Now many people file for bankruptcy without considering all of the facts and the financial ramifications.”

Whether or not you agree with his opinion, it is important for everyone to consider some statistics prior to making a judgment. Consider:

  • Over 90% of those who file for bankruptcy have suffered a job loss, medical event or divorce
  • 67% of all filers have lost a job
  • 50% have experienced a serious health problem
  • 44% of the filers are couples, 26% are men who file alone, and 30% are women who file alone
  • The average age of all filers is 38 years old.

(The Fragile Middle Class: Americans in Debt, by law professors from Harvard and The University of Texas)

What is interesting is that over 90% of Americans who file for bankruptcy have filed after a crisis. Most people do not want to lose a job, have serious health problems, or have their marriage end in divorce, and most people do not want to file for bankruptcy.

The California blogger is right, however, some filers do bear part of the blame. People make bad decisions, and there is a small percentage of people who try to manipulate the system. The system is governed by both federal and state laws and very few filers get away with bankruptcy fraud, but it does not mean that some filers do not try. Filing for bankruptcy is a legal process that is supposed to protect both creditors and debtors. It is supposed to allow honest individuals and businesses to make a fresh financial start.

Filing for bankruptcy can be complicated.  You may need to hire a bankruptcy lawyer to evaluate your financial situation. If you need relief from the stress associated with debt and you live in or around the metropolitan area of Newark, New Jersey, contact us at www.betterbankruptcy.com . We will help you find a bankruptcy attorney in your area who can answer your bankruptcy questions.

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