Bankruptcy and Retirement – What You Need To Know
Sun Lakes, Arizona is a community in Maricopa County considered by many to be one of the most beautiful towns in which to retire. Many people have chosen the gated communities and the tranquil suburbs to spend their golden years. What happens though, when the retirement dream goes wrong? There has been an increase in people using the services of the Sun Lakes bankruptcy attorneys to advise and guide them through the process of bankruptcy when their financial affairs deem it necessary.
The recession has meant that many more people are filing for bankruptcy and a means of protecting their assets from creditors. Any of the excellent Sun Lakes bankruptcy attorneys will advise you to take professional advice before filing for a Chapter 7 bankruptcy through the courts. Many people avoid filing for bankruptcy because they assume that it will be better for their overall credit rating or FICO score to engage in some kind of debt settlement rather than face bankruptcy. This might not always be the case suggest the Sun Lakes bankruptcy attorneys who have the local experience and insight into the Arizona state laws governing bankruptcy. If you are retired and living on a fixed income then bankruptcy may be the most prudent financial decision that you make.
Debt settlement gives you the same negative rating on your credit score as bankruptcy. The credit score system does not make allowances for the fact that you are attempting to pay off your debts. It just assumes that the creditor has made a loss on the transaction and will therefore give you a negative rating. You will also receive a negative rating when you declare bankruptcy, but the biggest difference is that you will be free to start again. There is no record of your debt hanging over you when you file for a Chapter 7 bankruptcy using one of the Sun Lakes bankruptcy attorneys. Your financial slate is wiped clean and you can start again without the cloud of debt hanging over you. While it might take time to rebuild your credit score with the banks, it is far more preferable than trying to work your way out from under a mountain of debt to clear your name.
As soon as you default on credit payments, you start to receive a negative FICO score. It does not get any worse if you file for bankruptcy or enter into debt settlement. The danger of debt settlement though, as any Sun Lakes bankruptcy attorney will advise, is that it does not make the debt go away and it also means that your creditors are still in the position of being able to sue you for the money at any time. It is vital, especially at retirement age, that you do not run the risk of having a judgement taken out against you. A judgement will allow your creditors to take any future income that you may receive as part of their settlement and they may even be able to take your most precious asset: your home.
Protecting your primary assets, which are your home and car, are part of the reason why it is so important to consult with one of the Sun Lakes bankruptcy attorneys in your area. They will be able to file for a Chapter 7 bankruptcy and make sure that your home is protected at all costs. Filing for bankruptcy means that you will get the chance to start over and manage your finances in a way that will improve you credit score and allow you to spend your retirement in peace an without the looming hassle of creditors hanging over you.
A Chapter 7 bankruptcy is a simple process, but it is best handled by a professional to ensure that you do not have to lose any more than is strictly necessary under the law.
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