Chapter 7 Bankruptcy Attorney Not A Stigma Anymore

When an individual hired a Chapter 7 bankruptcy attorney in yesteryear, this used to have a stigma attached to it. Today, this has changed for a variety of reasons. For one thing, the current economic climate has turned most individuals’ financial lives upside down in one way or another. For some other reasons, the rules regarding bankruptcy and establishing credit afterward have changed. Here are some things to think about:

- Current economic climate: Today, due to the burst of the housing bubble, an unhealthy job market, escalated use of credit cards and lack of universal health care, many people are drowning in red ink.

- Housing bubble burst: A few years ago, mortgage companies were giving everyone with a pulse a house loan. There were arrays of creative financing techniques including mortgages with no down payments, variable interest rates, balloon payments and more that allowed people who couldn’t actually afford a loan to still get one. Property values were rising daily or even hourly and homeowners were cashing in and buying larger homes or tapping their home equity. This was the equivalent of a house of cards with a shaky foundation. Eventually, it crashed, toppled and left a string of foreclosures and vacant neighborhoods around the land. This affected people around the globe in business and not who had investments linked to these unsavory loans.

- Unhealthy job market: Businesses have had to tighten their hiring belts because of lost customers who suddenly had no excess equity to tap or discretionary money to spend. Layoffs occurred in nearly every sector and the employment market has suffered.

- Credit card use: The 'buy now pay later' mentality became a part of the culture over the last few decades. Monthly payments seemed so easy until the compound interest got racked up. These plastic rectangles are good for banks and bad for consumers.

- Lack of health care: One accident or illness can wipe out an average person’s bank accounts. Employers used to offer health care as a normal part of an employment package. Today this perk is a rarity.

- Lack of stigma: Because so many individuals have ended up in the same financial boat, the stigma of filing bankruptcy has lessened. Not only are individuals not as shamed as they once were, they are often able to obtain mortgages and loans even more easily than their fellow citizen who is still paying off a mountain of debt. After a Chapter 7 filing, it is reported that consumers can apply for a mortgage in as little as six months time. Even some bill collectors have been known to advise citizens to just file bankruptcy because the debtor is in so deep and his or her health is suffering from the stress.

While going through a financial restructuring or liquidation is never easy, it may be the best solution to an otherwise hopeless situation. The person who decides to contact a Chapter 7 bankruptcy attorney will find that he or she is not alone and that the stigma which used to be attached, isn’t anymore.