Boleman Law attorney Chris Baker appeared on News 3 WTKR and talked about your bankruptcy options coming out of the COVID-19 pandemic.
After the COVID-19 grace period from creditors and lenders ends, people still may be struggling to pay their bills because of the economic impact and job loss.
When the debts become overwhelming and hard to keep up with, Chris Baker said bankruptcy may be the answer for some. Consulting a bankruptcy attorney could give you a fresh start with your finances.
“One of them is just flat out known as a ‘fresh start’ — known as a Chapter 7 –in the sense that creditors are not getting paid back anything but there are some risks to that,” Baker explained. “Chapter 13 bankruptcy, that one is a long-term repayment program.”
Baker said the Chapter 13 process is similar to debt consolidation, “in the sense that they are making one payment each month that gets dispersed to creditors.”
He also explained that your credit score will decrease after filing bankruptcy and appear on your credit report. The credit score can increase if you show proper and responsible credit use afterward.
“The bankruptcy is certainly going to resolve past debts that were there before, but you need something that’s painting a positive picture — what has changed about you since you filed bankruptcy,” Baker explained. “In the future, creditors and lenders are going to look at the credit report, and they want to see that you have a positive credit reporting history.”