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Bankruptcy may be the best option for many

The weight of overwhelming debt is a heavy burden for many people across Massachusetts. Bankruptcy may offer a way out, but many are concerned about the stigma and financial consequences that come with a bankruptcy filing. Despite that, bankruptcy is the best option for many.

According to the U.S. Trustees Program, approximately 733,000 business and people are expected to file for bankruptcy in 2018. That number is up from 2017 but far below the peak of 1.5 filings in 2010. The high number of filings is due to the massive personal debt the American people face. By the end of 2017, Americans held over $13 trillion dollars in debt. According to the Federal Reserve, $8.8 of that included mortgages while the rest was on student loans, car loans, and credit card debt.

The benefits of filing bankruptcy are clear. Bankruptcy will allow a debtor to eliminate or lower many of their debts if they comply with the bankruptcy rules. A fresh financial start has allowed millions of Americans to get their life back on track. Simply filing instead of delaying the inevitable can help some individuals keep from wasting assets that would otherwise be untouchable in bankruptcy court. There are downsides to bankruptcy, of course. The most important one is the effect a filing can have on a person's credit score. While a bankruptcy filing can make it difficult to get financing for larger purposes, many who are facing bankruptcy already have a credit score wrecked by defaulted debt.

While it can be scary, personal bankruptcy can be the best option for breaking the cycle of endless collection calls. A fresh financial start could mean an entirely new life for some. An attorney with experience in bankruptcy law may be able to help someone with heavy debt file for bankruptcy and eventually discharge their debts.

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