Severe debt can lead to a variety of problems, from diminished spending ability to constant calls from creditors. Although bankruptcy often comes with an undue stigma, the process can help people wipe away previous financial problems and get on the right path to financial health.
February filings for bankruptcy were up in the 21 counties of northwest Ohio for the first time in six years. The U.S. Bankruptcy Court in Toledo saw a 15 percent rise in filings to 281 cases in February 2018 after rates dropped the previous month.
The two main branches of personal bankruptcy are Chapter 7 and Chapter 13 filings, which are often called "liquidation" and "repayment" cases. Liquidation allows a trustee to take over a person's remaining assets and sell them to settle debts as completely as possible. Repayment helps people preserve their assets and work out a plan to repay debts over time.
Chapter 13 bankruptcy filings rose faster in Ohio than Chapter 7 filings. Liquidations increased 12.5 percent in February while repayments increased 35 percent. Federal law limits the number of times a person may file for bankruptcy, especially with repayment plans, so this indicates a significant increase first-time filings.
Some consumer products, such as online aids and form court documents, may make filing for bankruptcy seem easy enough to do without legal representation. But attorneys can help find the right bankruptcy plan to stop creditor harassment and get on the road to financial recovery.
Legal counsel can help sort out the financial circumstances that lead to possible bankruptcy. Professional legal advice can also decide if liquidation, repayment or other way to solve severe debt issues is right for you.
Source: Toledo Blade, "Bankruptcy cases in northwest Ohio increased last month," March 01, 2018