Avoid Bankruptcy and Know Your Rights

Oftentimes, people choose not to avoid bankruptcy because they fear what others like collection agencies are trying to do to them. So they opt for bankruptcy because they don’t know their rights under such protective measures like the Fair Dept Collections Practices Act. They also fail to avoid bankruptcy because they don’t stand back and realize that the worst that could happen to them is many times not that bad. Let’s take a look at some dynamics that might help to calm your fears and avoid bankruptcy.

Ask yourself what collectors can really do to you. They can sue you. That’s for sure. But what is the likelihood that they will sue you based on debt they bought for pennies on the dollar if there is even a remote possibility they cannot collect? Credit card companies have arbitration agreements that they are forcing on cardholders now that mean out-of-court settlements. But collection agencies more than likely have to go through the court system. This can be more expensive. If you are judgment proof meaning you have no assets then avoid bankruptcy because there is not much that can impact you even if they get a default judgment.

What if you do not get your day in court? If you avoid bankruptcy and a credit card company sues you then you will probably fall under arbitration and not get your day in court. In fact, most don’t even show up because they can’t really refute the debt. They just don’t have the money to pay. So a default judgment is awarded. A default judgment can be overturned if there are valid reasons you could not be in court or if service of process was not conducted properly. Cross that bridge when you come to it but fear of this should not be a reason not to avoid bankruptcy.

You may owe money but you still have your rights to dignity and privacy. And avoid bankruptcy to keep strangers from prying into your personal finances. No one can be a better judge of how you should manage your debt than you. That is the advantage with a debt management plan that allows your active participation. In bankruptcy, you are going to have lawyers prying into your personal financial affairs. They are going to be studying your assets. They are going to be scrutinizing your spending. It can be very humiliating. Bill collectors treat you like a criminal but must operate within strict parameters. Avoid bankruptcy and get into a debt management plan. You will have to deal with only a few people who are there to help and not humiliate you.

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