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Filing Bankruptcy May Help You Sleep at Night

Posted on October 25th, 2022

Debt Resolution

Bankruptcy often conjures up negative stereotypes and perceptions, but there’s no legitimate reason for the bad reputation this legal process has managed to earn. It’s simply a helpful debt relief opportunity that is often the only viable option for many people struggling with a financial crisis. If you have tried consolidation, repayment plans, or any other type of debt relief and are still struggling to stay on top of your bills, bankruptcy may be a good way to get a fresh start. A knowledgeable debt resolution attorney from Warren & Migliaccio, L.L.P. explains some of the basics about bankruptcy below.

Types of Bankruptcy

There are many categories of bankruptcy, but the two most relevant types for individuals are Chapter 7 and Chapter 13. Chapter 7 is the most common, making up over 69% of nationwide bankruptcy cases in 2021. That same year, Texas had over 12,000 Chapter 7 bankruptcy filings, which made up 63% of the total filings in the state

Chapter 7 bankruptcy allows certain debts, like credit cards, medical bills, and personal loans, to be discharged. The process often takes less than six months to complete and is well-suited for people with low income. Chapter 13 is often used in situations when an individual has a steady or significant source of income, but their debts are difficult to keep up with. If you file Chapter 13, you will be placed in a debt repayment program and given up to five years to make all of the allotted payments. 

The Benefits of Bankruptcy

Once you determine which one is best suited to your circumstances, you may begin to notice the advantages of filing for bankruptcy. 

  1. You’ll lower or eliminate your debt. 

Chapter 7 bankruptcy most often eliminates any unsecured debt, and Chapter 13 is intended to establish a repayment plan that allows you to lower the amount you must pay to creditors. 

  1. You may be able to keep your home. 

If you are facing foreclosure, filing Chapter 13 bankruptcy will likely stall that process until a repayment plan can be established. This may also give you time to sell your home to repay the lender.

  1. Collection agencies will stop contacting you.

When you file for bankruptcy, creditors can no longer call you or threaten you with lawsuits until your Chapter 7 or 13 bankruptcy case is settled. This gives you a reprieve from the harassing communication and lets you breathe a little easier for a while.

  1. You may be able to keep some property. 

Bankruptcy decisions are not made without conscience. There is an understanding that certain items are necessary for people to function in society, which means that some of your belongings will be safe from creditors even when you file for bankruptcy. Exactly which assets you’ll be able to keep will vary based on your case.

  1. Your stress level will lower. 

Financial worries plague a substantial percentage of the population, with around 73% of the people in the U.S. ranking finances as the most significant stressor in their lives. Filing bankruptcy can decrease this stress by lowering your debt.


Bankruptcy is not a solution to every financial issue people may face, and it does come with its own set of complications. Not every type of debt can be discharged, including taxes and child support. In addition, bankruptcy negatively impacts your credit score. However, for those with debt and money hardships with no other solution for resolution, filing for bankruptcy can be the appropriate option to get them back on the right track. 

To explore different options to help you with your financial issues, contact a debt resolution attorney today.


Fill out the form below to get in touch with our legal team or call Bozeman office at (406) 582-8822 or our Helena office at (406) 449-4829 to talk to someone right away.

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