Is Bankruptcy a Good Idea?

Deciding whether to file for bankruptcy can be difficult. It doesn’t help that there’s so much misinformation out there about bankruptcy. For example, a common belief is that bankruptcy permanently ruins your credit. Another is that people who file for bankruptcy are irresponsible. This couldn’t be further from the truth. In this article, we take an objective look at whether it’s a good idea to file for bankruptcy when you’re experiencing financial difficulties. 

What Causes Bankruptcy? 

As noted above, a common myth is that people who file for bankruptcy are irresponsible with money. Some are, of course, but many aren’t. People are often forced into bankruptcy due to circumstances that are beyond their control. Common reasons for bankruptcy include:

COVID-19: Many people have been forced to file for bankruptcy due to the current COVID-19 pandemic. Governments have shut down businesses in an effort to stop the spread of the virus, leaving many people with no way to make a living. 

Unforeseen illnesses: In addition, many people are forced to file for bankruptcy due to unforeseen illnesses. Often, when a person gets sick or injured, he or she is burdened with a growing stack of medical bills. Many people simply can’t afford to keep up with the bills associated with unforeseen illnesses.

Spending by a family member: Some people are forced to file for bankruptcy due to the actions of others, such as spending by a family member. 

Why Does Bankruptcy Have a Bad Reputation?

The false correlation between financial irresponsibility and bankruptcy contributes greatly to its bad reputation. In addition, many people believe that bankruptcy irreversibly damages one’s credit score. This simply isn’t true. Yes, bankruptcy does temporarily damage the credit score of the filer. However, this certainly doesn’t last forever. In fact, many people are surprised how quickly their credit bounces back after filing for bankruptcy. 

Deciding if Bankruptcy is Right for You

Whether bankruptcy is a good idea for you ultimately depends on your individual circumstances. Bankruptcy isn’t inherently bad or good. However, it can be extremely useful for people who have run into financial difficulties. The purpose of bankruptcy is to discharge debts and allow debtors to get back on track financially. Therefore, if you need a fresh financial start, it’s quite possible that bankruptcy may be a good option for you. However, to be sure, you should contact a Milwaukee bankruptcy lawyer for assistance. 

Contact a Milwaukee Bankruptcy Lawyer 

If you would like to explore your bankruptcy options in Milwaukee, you should contact an experienced Milwaukee bankruptcy lawyer as soon as possible. At Hanson & Payne, our experienced bankruptcy attorneys offer bankruptcy and debt negotiation services for individuals in Milwaukee and all over southeast Wisconsin. Therefore, if you think bankruptcy may be the right choice for you, please contact us as soon as possible to schedule a consultation.