I’m accustomed to advising those on the verge of filing bankruptcy about big ticket debts like mortgages, student loans, and back taxes.
I was surprised when a client, resigned to letting her house go to foreclosure after the bankruptcy, was absolutely delighted to know that she could free herself from her unhappy relationship with Verizon Wireless at the same time.
She had a two year contract with fees and charges for early termination.
Bankruptcy terminates executory contracts in force when the case is filed.
So the balance of the two year contract with the unsatisfactory provider could be terminated, and the early cancellation penalty treated just like any other unsecured creditor.
The same legal principle applies to cable or other TV subscriptions. Or a too-expensive business lease.
Get out from under pricey services you don’t need or don’t like, without penalty.
I’m adding to my list of things to do before you file, like change banks and cancel automatic payments from your checking account, ? consider dumping your cell phone provider.
More about bankruptcy planning
Reducing the number of creditors