From iconic department stores and entertainment giants to small mom and pop stores and individuals, the Covid-19 pandemic has seemingly spared no one in its devastation of the U.S. economy. Falling consumer demand, reduced entertainment spending, and stay-at-home orders mandating certain businesses stay closed have taken a major toll on the retail industry that was struggling the past few years as everyone started to shift to online shopping.
Even as the economy is slowly starting to reopen, social distancing measures are still impacting restaurant and store capacity, creating long-term issues. For most of these businesses, filling bankruptcy seems to be the only ticket out of a financial ruin. Although bankruptcy doesn’t inherently mean that a company will go out of business, it does spell news of changes to come.
The financial toll and havoc of Covid-19 has equally impacted individuals. The number of people filing for bankruptcy has set records. This peak will be all about the reality of a Covid-19-blasted economy. Although the federal stimulus payments, mandated mortgage and other loan forbearance, unemployment insurance enhancement and the additional support provided by the CARES Act has prevented a major tidal wave of personal bankruptcies, there could still be a surge if unemployment and loss of income persist.
What You Need to Know If You’re Considering Bankruptcy
If you are in a precarious financial position, you may want to consider filing for bankruptcy. Chapter 7 bankruptcy is one of the most common types of bankruptcy you can file for. It is a powerful legal tool that allows you to totally erase many unsecured debts, including:
- Credit cat debt
- Medical debt
- Car loans
- Personal and payday loans
- Judgments from credit cards and debt collection agencies
- Utility bills
Signs that Chapter 7 Bankruptcy Is Right Option for You
The most important questions you should ask yourself if you are considering Chapter 7 Bankruptcy is whether you have more debt than you’ll ever be able to pay back, given your current income and property. If you do, then Chapter 7 bankruptcy may be the right option.
Some signs that may indicate that filing Chapter 7 Bankruptcy may be the right option for you now include:
- You have more than $10,000 of dischargeable debt
- Your credit score is already low (below 600)
- You don’t own expensive property
- Keeping up with payments is making it impossible to make ends meet every month
- You’re worried about wage garnishment or being sued for your debt
- You pass the means test because you earn under the median income in your state
- You don’t see a way of being able to pay back your debt over the next 5 years
Call an Experienced Central Valley Bankruptcy Attorney
If you are considering Chapter 7 bankruptcy, it is in your best interest to consult with an experienced bankruptcy attorney to help you learn your legal rights and options, especially with respect to Chapter 7 bankruptcy.
For more information or to schedule a complimentary consultation with Central Valley bankruptcy attorney Gurjit Srai, please call 209-323-5558, or complete our online form.