California and the Sacramento area are beautiful places and offer many benefits to seniors and retirees. Unfortunately, many older folks in the area are under a terrible burden of debt that makes it difficult for many struggling seniors to take control of their lives. Many factors contribute to this reality. The most common are a sudden loss of income, retirement income that is less than anticipated, unexpected medical bills, and the need to provide support for adult children and grandchildren.
Bankruptcy can be a lifesaver for many seniors. But everything from pride to lack of information can keep them from seeking the relief that bankruptcy can so often provide. Below are five big ways in which bankruptcy can help seniors who are struggling under the burden of debt.
1. Qualified Retirement Plans Are Exempt Assets
This means that creditors cannot get to the principal of almost all retirement plans. In addition, social security income is exempt in bankruptcy. Seniors are very often concerned that they will lose everything if they file bankruptcy. In the vast majority of cases, folks keep all of their personal property, including vehicles, household goods, and bank accounts.
2. No More Phone Calls
Anyone who has fallen behind on payments for anything knows how stressful it can be when receiving phone calls day and night from creditors. When a person files bankruptcy, the automatic stay goes into effect and she is legally protected from creditors. They will no longer be allowed to contact the debtor and threaten repossession, foreclosure, or wage garnishment. This includes phone calls, emails, and letters in the mail. To stop creditors harassment you can call one of our bankruptcy attorneys in Sacramento, CA for a free consultation.
3. Fresh Start
Being under the suffocating burden of debt can feel like a never-ending problem that is totally insurmountable. However, bankruptcy provides the opportunity for a financial fresh start that opens up the possibility to rebuild finances and live a debt-free future.
4. Discharge Debt
The bankruptcy discharge is a court order that indicates that the consumer will not have to pay most of her debts. It is important to note that not all debts are dischargeable in bankruptcy, like student loans, child support, alimony and most taxes. But the lion’s share of unsecured debt like credit cards and medical bills will be discharged.
5. Stall Foreclosure
Many older folks have trouble keeping up with a mortgage. For some, bankruptcy can help the consumer catch up on mortgage payments so she can stay in her home. For others, it’s time to downsize to a smaller home or apartment. In that case, bankruptcy can delay foreclosure and allow the debtor time to get her affairs in order to make the move.
Bankruptcy exists to provide protection for people that desperately need it. Life is a precious thing and time shouldn’t be spent worrying about money problems. Bankruptcy can help those struggling to make ends meet relieve stress so that they can focus on the important things in life, like spending time with friends and family.