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New Years Resolution and Bankruptcy- Less Debt Improves Your Health!
11 January 2014

New Years is a time to create resolutions for Garden Grove City citizens! About 48% of Americans create a list of resolutions each year. Of such individuals, only about 10% actually achieve their listed resolution goals for the year. Although, the odds are slim, with the correct financial plan you can be one of the few. Have you considered filing bankruptcy? How does that help?

Health is usually the number item on a New Years list resolution. Good health, involves less stress, more free time, less anxiety, and permits one to continue to focus on maintain such good health. However, factors that impact health have always been determined to possibly stem from financial stressor, such as overwhelming debt. Thus, the greater the debt, the more mental health and physical risks one may encounter.

A positive step to reduce financial stressors is to reduce your debt. Reducing debt is completed in one of three basic ways: (1) paying off he debt in full; (2) achieving a settlement; and (3) discharge of the debt through bankruptcy.

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Paying off the debt in full

Paying off debt in full is almost impossible for many. If it was easy, many would have done so already. However, for many it is not a reality. Those who have limited funds in the bank accounts do not wish to spend it to repay credit cards etc. that have been accumulating, especially in light of a fragile environment.

Achieving a settlement

Paying off a portion of a debt seems to intrigue many. However, by the time such debt is reduced, creditors and collection agencies have already inflated it. Such debt has already damaged your credit and increased dramatically due to interest and costs/legal fees incurred. Further, settling the debt will cause you to receive a 1099 (miscellaneous income) for the amount you saved. In other words, you are back a step 1.

Bankruptcy Discharge

For many this is the best option. The impact of filing for bankruptcy is minimal on your credit since a person’s credit is usually damaged to the excess debt and any debt that may have come into arrears. Further, you will not receive a 1099 (miscellaneous income)/taxed on the discharged amount. Almost all debt is discharged under a Chapter 7 Bankruptcy (i.e. Credit cards, medical bills, law suits, rent in arrears, mortgages, car loans). Some debt is typically not dischargeable though (i.e. student loans, spousal/child support, and back owed taxes [less than three years typically]).

The process to file bankruptcy is complex and requires an experienced bankruptcy attorney. Further, a debtor wishing to apply for Chapter 7 bankruptcy must meet certain qualification requirements.

Call for your free consolation!

It is crucial to select an experienced Bankruptcy Attorney. Garden Grove City attorney Gregory E. Nassar is an experienced Bankruptcy Lawyer gladly serving Garden Grove City, and other cities within Orange County, Riverside County, Los Angeles County, and San Bernardino County. Attorney Gregory E. Nassar will review the case, carefully evaluating all the circumstances of client to determine the best route to solving the client’s financial detriment and fulfill a New Years Resolution! Cheers to your health!


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