Silver Spring Bankruptcy is a complicated legal proceeding. Although the debtor only has a very quick court date, it can take several months for the full bankruptcy to be approved and for certain debts to be discharged. Bankruptcy is a serious proceeding, and it has definite consequences, but one of the myths about bankruptcy is that it is to be avoided at all costs, no matter how high a price you pay. However, bankruptcy can actually be a fresh start for the right debtor.
Unfortunately, there is a big business in debt consolidation. While debt consolidation done through an attorney’s office can be beneficial for the right debtor, there are many unscrupulous companies out there who actively warn consumers to avoid filing for Silver Spring Bankruptcy, no matter what. They say it will ruin your credit permanently and it will follow you everywhere. Debt collectors will even lie to debtors and tell them that it is impossible for them to receive a bankruptcy discharge. Creditor-run debt consolidation programs have high fees and interest rates, and are usually in the best interest of the creditor, not the debtor.
The truth is that with the advice of the right attorney, bankruptcy offers a debtor legal obligations but also legal protection from their creditors. It stops harassment from bill collectors. The Bankruptcy Abuse Prevention and Consumer Protection Act was intended to push more debtors into filing a Chapter 13 bankruptcy in which they had to pay off a portion of their debts, instead of a Chapter 7, in which debts can be fully discharged.
While the new bankruptcy code greatly increased the amount of paperwork required, which gets passed on to the debtor as increased attorney fees, the truth is that most debtors who would have qualified for a Chapter 7 bankruptcy prior to the change in bankruptcy law can in fact still qualify for a Chapter 7 bankruptcy today. Once the court approves of the discharge of debt, it is gone forever, and the creditor may not collect on it. Most debtors are able to re-establish a decent credit rating within three years after their bankruptcy is discharged.