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August 2017 Archives

Chapter 13 bankruptcy and the benefits of the automatic stay

Many individuals in Connecticut and across the country have suffered through periods of significant financial burdens. The constant phone calls and collection letters that accompany overwhelming debt can add a great deal of stress to an already difficult situation, prompting some to explore the available options for relief. Those in search of protection from creditors may find it advisable to consider the potential benefits of filing for Chapter 13 bankruptcy, such as the automatic stay.

Knowing what to expect with Chapter 13 bankruptcy

Filing for bankruptcy is rarely a decision that is made lightly. In fact, someone who is struggling with overwhelming debt because of a divorce, medical expenses or other financial setback may have tried many other options to regain financial footing before deciding to investigate bankruptcy. Some in Connecticut may seek Chapter 7, which discharges some (and sometimes all) debts through the liquidation of nonexempt assets. However, those who have a steady income or otherwise do not qualify for this type of debt relief may find Chapter 13 works for them.

Payday loans do not provide debt relief

It is not uncommon for people in Connecticut to find themselves short of cash with days to go before the next paycheck. Whether it happens because of poor planning or unforeseen circumstances, it is never a pleasant feeling. In fact, it may bring a sense of panic if there are bills left unpaid and necessities to purchase. While it may seem like temporary debt relief is better than none, some find themselves digging deeper into debt by using quick fix loans in times of desperation.

Credit card debt still common reason for Chapter 7

Shopping with a credit card has its advantages. Along with the convenience and the ability to purchase items that may otherwise be unaffordable, some credit cards offer perks for their loyal customers. However, consumer advocates may be concerned about the dramatic increase in the required spending to earn those attractive perks, especially since credit card debt is one major factor when consumers in Connecticut and elsewhere file for Chapter 7 bankruptcy.