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Unexpected events and unfortunate circumstances - such as a medical emergency, a work injury or sudden job loss can quickly take a financially stable person into a troubled world of spiraling debt and financial difficulty. Some people have a sense of guilt over their inability to catch up on their bills, or they have erroneous preconceived notions about how bankruptcy will impact them and what others will think of it. These feelings, while common, and are unwarranted. Many people have gone through the process of bankruptcy, and gone on to live highly successful lives including President Lincoln, Donald Trump, Larry King, and Mike Tyson, to name a few. Bankruptcy offers protection in times of extreme need. For example:

  1. If your wage garnishment is making it difficult to manage everyday needs, such as buying groceries, or gas for your car.
  2. If you have a home under threat of foreclosure
  3. If you’re trapped in an escalating adjustable rate mortgage, which you are unable to afford or refinance

The primary purpose of bankruptcy is to give an honest debtor the opportunity to start over by either:

  1. Legally discharging debts or
  2. By providing a court supervised plan to help the individual repay a manageable amount of their debt.

Bankruptcy allows you to be discharged from the legal obligation to pay most debts by submitting your non-exempt assets,* if any, to the jurisdiction of the bankruptcy court for eventual distribution to your creditors. During bankruptcy proceedings, you are protected from most non-bankruptcy legal action by creditors – so they cannot pursue lawsuits, foreclosure, repossession, or wage garnishment.

Bankruptcy protects your home, car and personal property

Bankruptcy immediately stops creditors from seizing your home, car or other personal property so that a reasonable, and court supervised debt resolution plan can be developed, and then accomplished. However, timing is important. Don’t wait until your creditors have actually repossessed or foreclosed on your property before you file for bankruptcy – because the law may prevent you from reclaiming those assets when you do file for bankruptcy protection.

Seattle Debt Law will take an in-depth look at your situation and help you understand what bankruptcy options are available to you. In general, there are three types of bankruptcy filings that pertain to most individuals and small businesses in Western Washington:

*Non-exempt assets may include: cash, stocks, bonds, investments over a certain amount, an expensive car, second home, family heirlooms over a certain value, collections of paintings, coins or stamps or expensive trade or business equipment.