• Home
  • Bankruptcy in Brief
  • ABC’s of Bankruptcy
  • Considering Bankruptcy
  • True Stories
  • Chapter 13
  • Blog
  • About
  • TOC

Northern California Bankruptcy Lawyer

On The Bankruptcy Soapbox

The Soap Box
  • How bankruptcy works
  • Mortgage Matters
  • Consumer Rights
  • You & Your Lawyer
  • Small Business
  • Family Law

Are You Better Off With Bankruptcy?

By Cathy Moran

Bankruptcy trends meaningless

Who cares whether bankruptcy filings are up or down?

Bankruptcy professionals, certainly.

Economists, probably.

But if it’s you and your checkbook, you take little comfort that lots of others are filing.  Nor, when everyone else seems to be making it OK  while you flounder, are you reassured.

Bankruptcy seems to follow economic expansion.  Some expansion always falls flat.  Bankruptcy is the remedy for the enterprises that don’t make it.

And for the society, bankruptcy is a powerful remedy.  It allows risk taking without life-altering consequences.  It allows those who’ve made bad decisions or simply had bad luck to start over.

Bankruptcy evens the odds in the eternal tension between borrowers and lenders, debtors and creditors.

Bankruptcy keeps people in the above-ground economy, allowing a legal and effective protection for future earnings.

Look backward or forward

But bankruptcy statistics are the sum of individual decisions.

Parents who have to decide whether being bound to past commitments is the best choice for their family.  Whether putting off providing for retirement, or even a cash reserve for emergencies is wise.  Elders who are saddled with credit cards they can never repay.  The underemployed balancing old debts and new needs.

It takes some courage to admit to yourself, and then to others, that you can’t do what you’d rather do: pay everyone what you promised you’d pay.

But, in the real world,  you are your harshest critic.

Few others sit in judgment of those who file bankruptcy.  If they notice at all, it’s with a sense of “there but for the grace of God...”

Better off with bankruptcy

A university study several decades ago concluded that one in seven American families would be better off if they filed bankruptcy.  It tried to explain why far fewer than that were doing what was in their best interest,  but instead struggled on with their debts.

The number who would be better off if they filed bankruptcy cannot be lower now.

In the end, it’s about what makes you more self sufficient going forward.

More

How to weigh whether bankruptcy is the right choice

What bankruptcy can do to old tax debt

Image courtesy of Pixabay.

More from the Soapbox

  • Debt Collection Breakthrough ProtectionDebt Collection Breakthrough Protection
  • Feds Offer Deferral Option For Home Mortgage PaymentsFeds Offer Deferral Option For Home Mortgage Payments
  • Your Rights When Your Home Is ForeclosedYour Rights When Your Home Is Foreclosed
  • Foreclosure the day after tomorrowForeclosure the day after tomorrow
  • Turned Down For A Bank Account?  Fight BackTurned Down For A Bank Account? Fight Back

Filed Under: Considering Bankruptcy, Consumer Rights

About Cathy Moran

I'm a veteran bankruptcy lawyer and consumer advocate in California's Silicon Valley. I write, teach, and speak in the hopes of expanding understanding of how bankruptcy can make life better in a family's future.

Bankruptcy Basics

About The Soapbox

You’ve arrived at the Bankruptcy Soapbox, a resource of bankruptcy information and consumer law.

Soapbox is a companion site to Bankruptcy in Brief, where I try to be largely explanatory and even handed (Note I said “try”).

Here, I allow myself to tell stories and express strong opinions. We dig deeper into how to consider bankruptcy and navigate a bankruptcy case.

Moran Law Group
Bankruptcy specialists for individuals and small businesses in the San Francisco Bay Area

How Bankruptcy Works

How Much Is My Chapter 13 Payment

Intrigued by Chapter 13, but worried about how much your Chapter 13 payment might be? OK, let's walk through what your payment must be by law and what you want that payment to cover to get a fresh start. Part of the power of Chapter 13 is that you write the plan, with the help of your bankruptcy lawyer. Forget … Read more

More Posts from this Category

643 Bair Island Road
Suite 403
Redwood City, CA 94063
Phone: (650) 694-4700
Phone: (650) 368-4700

Categories

All content copyright © Moran Law Group. All rights reserved.