The COVID-19 coronavirus outbreak is a financial nightmare for many people in Missouri. Individuals and business owners who were staying just above water are ending up deep in debt because of the loss of a job, lack of customers, or paying for medical care for a sick loved one. For those who are worried that they will never get out from under the post-coronavirus debt, bankruptcy may be an option to help get a new start.
Unemployment Continues to Rise
Unemployment claims are up. Last week, 6.6 million Americans applied for unemployment benefits. Unemployment claims will likely continue for a while, leaving millions of Americans unable to pay off existing debt. A stimulus package payment may help but it is not likely to be enough to help many people stay afloat.
People who may be most at risk are those with a lot of existing debt from past expenses. They expected to rely on a regular income to pay down those debts over time, even if it would take a long time to balance out the accounts. Some sources of large amounts of debt include long-term investments like a home or college education. These debts are generally planned for and borrowers generally understand it will take years to pay down the debts.
Alternatively, there are many people who are hit with a sudden or unanticipated bill. This includes a serious illness, injury accident, or even a messy divorce. A serious car accident that is not covered by insurance could end up costing tens of thousands of dollars. Even after surviving a serious illness and recovering, it can take a long time to pay down the medical debt.
Why File for Bankruptcy After Job Loss?
Many people put off filing for bankruptcy because they feel like they will eventually be able to pay off their debt if things turn around. Unfortunately, for many people, their debt will continue to increase because of late fees, high interest rates, and a salary that does not keep up with the cost of living. Filing for bankruptcy is not giving up. Bankruptcy is a chance for a new start.
Chapter 7 bankruptcy was created for the kind of situation many people are finding themselves in because of the coronavirus outbreak. The economic impact of this pandemic is leaving many people out of work or unable to work enough to pay their bills. Even if the individual can get a temporary break from a landlord or the credit card company, they are still having to pay for groceries, buy gas, and figure out child care.
In a Chapter 7 bankruptcy, after the individual completes the filing, bill collectors have to stop harassing phone calls. This can provide an immediate sense of relief. The debtor is allowed to keep some exempted assets, including jewelry, firearms, and value in a home or vehicle. The remaining assets are taken over by a trustee and liquidated to pay creditors. The whole process takes about three to five months and at the end, remaining debts are discharged.
Missouri Bankruptcy Lawyer
Getting started on filing bankruptcy today can be a way to get a fresh start after the financial crisis. If you have questions about filing for bankruptcy in Missouri, contact the Joshua Wilson Law Firm in Raymore today. Contact us online or by calling (816) 331-9968. We maintain a virtual capable law office to keep you safe.