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During economic turmoil, many people find that they still have a job, but don’t make as much money as they used to. This can come about in many different ways:

  • Reduced hours at work.
  • Pay raise freezes. Because inflation always goes up, if you don’t earn a little more each year then it's as if you are making less.
  • Reduced pay. Many companies offer employees lower pay instead of layoffs. These employees may be doing the same work, but simply for less money.
  • Lay-off plus a new, lower paying job. Many people who are laid off find they are unable to find a job that pays as well as their previous one. Instead, they take a new job that pays less and try to tighten their belts.

While some income is better than no income, it still may not be enough to make ends meet. And even if it happens very slowly, unbearable debt is still unbearable debt.

If your new job situation doesn’t provide enough money to make ends meet, and you find yourself growing deeper and deeper in debt, you may choose to seek the protection of bankruptcy.

The two main types of bankruptcy offer different types of help, depending on your situation.

Chapter 7 bankruptcy. In order to file for Chapter 7 bankruptcy, which may eliminate all credit card and other unsecured debts almost immediately, you must meet certain eligibility requirements. Typically, your income must be below the median level in your state.

So even if you weren’t previously eligible for Chapter 7, your new job status may mean you could now file. And filing for Chapter 7 bankruptcy would offer you the protections of the automatic stay, which is designed to stop creditor harassment, while clearing your debt.

Chapter 13 bankruptcy. Because you have a job with some income, Chapter 13 bankruptcy could be a good option, particularly if own your house, cars or other valuable property.

To file for Chapter 13, you need some regular income. Your income may be lower than it was, but you may still have a steady paycheck. Now, Chapter 13 could be able to make you really stretch your dollars to pay down your debt.

Alone, you would have to juggle pay schedules and creditor demands while fighting late fees. You could also face pressures from foreclosure or repossession threats.

But the Automatic Stay court order, which takes effect as soon as you file bankruptcy and protects throughout your case, puts a halt to all creditor claims. This means that phone calls, collection letters, foreclosure proceedings, lawsuits and wage garnishment must stop. Right away.

Then, your debts will be ordered and they may even be reduced. Instead of making multiple monthly payments, you’ll simply write one check to your bankruptcy trustee who will handle your creditors. The courts will work out a repayment plan, typically 3-5 years. You should be protected this entire time, and at the end your debts will be cleared and your property will remain safe.

Don’t stress about short paychecks. Get debt relief today!

If your current paycheck won’t go far enough, and if your debts are increasing to the point of being out of control, you may want to speak with a bankruptcy attorney about your debt relief options, including filing bankruptcy.

Fill out our free case evaluation form and we’ll put you in touch with a bankruptcy lawyer near you. A local bankruptcy attorney can answer your questions and talk to you about how bankruptcy may help you eliminate your debt.

Tap to Call - (877) 250-8242

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