Did you know that the IRS is afraid of the Bankruptcy Court? Yes, that is true. Bankruptcy is the one way you can shut down the single most powerful and aggressive creditor—The United States of America. Many people enter into a bankruptcy consultation with fear about what the IRS or some other powerful creditor may “think” if they file bankruptcy. The truth is, they will think they need to be very, very careful not to anger the Bankruptcy Court. It is sometimes hard for people to accept that the Bankruptcy Judge primarily is there to protect the person or entity filing bankruptcy and to make certain that they get a new start.
Another example of the power of the Court is the General Motors fiasco concerning the recall on the ignition switch. You would think that GMAC would be flooded with lawsuits over the fact that they were slow to get the word out. The problem is that those claims were largely extinguished in the recent bankruptcy filing by the company. Several advocacy groups have requested that GMAC put up a fund of $1 billion dollars and waive their protection from the bankruptcy up to the amount of that fund. It is likely that GMAC will do that, but the amazing thing is that they are currently protected.
Have you had your driver’s license suspended because you got into an accident and your insurance has lapsed? Bankruptcy can get your license back for you. The reason that you get your license suspended after an accident is that you failed to show how you would financially provide for the damage done. When you file bankruptcy, the Bankruptcy Court wipes out the obligation so you no longer are responsible financially. The Driver’s License is reinstated because you have taken care of the financial responsibility.
Have you got a tow truck following you around because you cannot catch up on your car payments? Bankruptcy will stop the creditor from taking your car and putting you in an even worse situation. Bankruptcy puts up a big stop sign that will prevent your creditor from taking action against you! If they somehow get your car before they got notice of the bankruptcy, they get to return it to you in the same shape as it was when they took it.
Have you got a foreclosure pending on your house? Yes, bankruptcy will stop that as well. No, you don’t get a free house, but the bankruptcy will allow you to restructure the amount of the debt that you are behind and pay that back over a five year period. You get to go from desperately about to lose your house to an actual plan to pay it back and retain the biggest investment you have ever had.
Have you got a creditor who is threatening to garnish your bank accounts to collect a debt? Bankruptcy will stop that as well. How about those endless calls to your telephone and to your employer constantly letting everyone know that you are struggling to make ends meet? Yes, that will stop also.
Don’t forget about the fact that you are not able to sleep or that your marriage is suffering from the stress of the debt. It is amazing how much stress will be removed once you formulate a plan for attacking the debt. Most individuals very quickly realize that they are sleeping better and that their marriage is significantly better because they have finally begun to attack that huge elephant in the room that has been the focus of all of their waking and sleeping hours!
If you are faced with too much old debt, bankruptcy can be used to help you also become more lean and efficient. It can help you begin setting money aside for the children’s education and future. If you are in this situation, book an appointment with a skilled bankruptcy attorney. At Bailey & Galyen we would like to help you achieve your new future.
