Filing for bankruptcy should always be your last resort as a business owner since bankruptcy is a big deal and it can affect future financial and business opportunities. However, it is also important to remember that there are times when filing for bankruptcy is the only last resort, and before you make any decision, you should always sit down with a qualified bankruptcy attorney and consult them regarding the matter and for any business bankruptcy help. You can also go through the following list of pros and cons to have a basic understanding as well.
- Once the court has accepted your filing for bankruptcy, they will issue a stay against all debt collection. This means your debt collectors will have to immediately back off, so they cannot call you, send you a letter, or anything of the sort. This stay order will stay in effect until your case has been reviewed later.
- Filing for bankruptcy can help you opt for exemptions of certain assets, so that means you can still retain ownership of your property provided that you are eligible for it.
- Filing for bankruptcy can also help to cancel off certain types of debts automatically like personal loans, medical loans, and credit card loans, etc.
- All of your credit cards will be canceled immediately after you file for bankruptcy, which will, in turn, affect your credit score, and the only way you can raise your score again would be to opt for unsecured credit cards which have high fees, high interest, and higher annual charges.
- Not all of your property and assets will stay secure just because you file for bankruptcy. There are plenty of exemptions in this case and you can end up losing property or assets.
- The likelihood of your getting approved for loans, especially from banks will drop significantly after you file your bankruptcy.