April 10, 2020 — Los Angeles, CA — Individuals turn to Los Angeles bankruptcy Lawyers for relief as the COVID-19 pandemic causes record unemployment and debt.
Los Angeles bankruptcy attorneys are fielding calls from individuals devastated by the health and financial effects of the virus. According to Matt Faler, voted “Best Los Angeles bankruptcy Lawyer” with Consumer Action Law Group*, “We are fielding calls every day from people that have been financially wiped out by the COVID-19 pandemic. Nearly every person that calls either has massive credit card debt or medical bills or both, and there is no way for them to pay off their debt in the near future.” Now individuals are turning to bankruptcy in record levels to eliminate their debt and to get back on their feet financially.
Millions of people left work for weeks in California and many other states, and the daily expenses continued; mortgages and car payments, groceries and health insurance, medical bills and utilities. According to Lawyer Matt Faler, “Most people didn’t have enough savings to get through the pandemic which led to more debt. When we file bankruptcy, it stops collection calls immediately and wipes out credit card and medical debt.”
When to file Chapter 7 bankruptcy
The primary reason people file chapter 7 bankruptcy is to immediately eliminate credit card debt, medical bills, old IRS debt, and debt related to lawsuits such as judgments or liens. Chapter 7 bankruptcy is most effective when an individual is unable to get rid of his or her existing debt within 2-3 years.
However, individuals with an income level or home equity too high may not necessarily qualify for Chapter 7 bankruptcy. This may depend on their expenses and any other people within the household. It is recommended for consumers to speak with an experienced Los Angeles bankruptcy lawyer to learn more about their specific situation.
When to file Chapter 13 bankruptcy
One of the main reasons individuals file Chapter 13 bankruptcy is to get caught up in paying their mortgage payments or car payments. People may fall behind on their payments because they were laid off from their job. In this case, filing chapter 13 prevents the foreclosure process, repossession, and eliminate credit card debt, medical bills, old IRS debt, and other debt related to lawsuits such as judgments or liens.
Generally, most individuals who file Chapter 13 do so because they were falling behind on their mortgage or car payments and are unable to get rid of their debt within 2-3 years. If the amount of debt owed is extremely high, the individual may qualify for Chapter 13 bankruptcy as well as Chapter 11 bankruptcy, depending on the amount of debt owed. Again, the best way to figure out which bankruptcy is the most beneficial to the individual is to discuss it with experienced Los Angeles bankruptcy lawyers.
Why file bankruptcy during the COVID-19 pandemic?
Filing bankruptcy is one of the most effective ways for an individual to wipe out his or her excessive debt. There are misconceptions that banks and credit card companies spread about how bankruptcy will crush a person’s credit for 7 years. Filing bankruptcy can actually help improve a person’s credit profile. Yes, bankruptcy does remain on an individual’s credit report for 7 years, but the substantial negative impact of it usually goes away after 1-2 years from the filing date. This is because the person will have had time to rebuild their credit without the immense amount of debt weighing down on their credit profile.
Any individuals who have questions about bankruptcy should reach out to experienced chapter 7 and chapter 13 attorneys. The lawyer can answer common bankruptcy questions such as how eliminating debt with bankruptcy works, how to qualify for bankruptcy, and how much it would cost to hire a lawyer to help file bankruptcy before the stress and anxiety of debt collector calls kicks in.
About Consumer Action Law Group
Consumer Action Law Group is a law firm dedicated to helping individuals in consumer-related matters such as fraud and scams by car dealers, credit card companies, and lenders. Attorneys on the team are knowledgeable and experienced in the areas of eliminating debt, auto fraud, lemon cars, recovering surplus funds, as well as home foreclosures.
*Consumer Action Law Group was voted as “Best in Los Angeles” in 2018 by Three Best Rated.
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