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How do you make the decision to file for Chapter 7 bankruptcy?

When New York residents face financial challenges, they also face difficult questions. They may explore all of the possible options, but, in many cases, the only reasonable option might be filing for bankruptcy. So, how do New York residents make the decision on whether or not they should file for Chapter 7 bankruptcy?

The decision to file for bankruptcy is a big one, but, like most other decisions, it can be approached by weighing the pros and cons. When most of our readers think of bankruptcy, they probably think that the "cons" outweigh the "pros." But, in many cases, that isn't the result of this weighing test.

Most people understand that a bankruptcy filing will hit a person's credit hard -- that's the biggest con. However, this hit can be balanced out by many of the benefits of a bankruptcy filing, such as the immediate stay that goes into effect against creditor harassment and collection efforts. A bankruptcy filing can also result in a discharge of many debts.

When it comes to assets, another perceived "con" of a Chapter 7 bankruptcy is that all of a person's possessions will be seized. This is a myth. In fact, there are many bankruptcy exemptions that will protect many of the filer's possessions from asset liquidation.

There are many more "pros" and "cons" to weigh in the decision on whether or not to pursue a personal bankruptcy filing. However, with the right information and the right approach, New York residents can get a fresh financial start with a bankruptcy filing.

Source: FindLaw, "Pros and Cons of Declaring Bankruptcy under Chapter 7," Accessed April 16, 2017

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