Reasons You Should File for Bankruptcy Right Away

If you have struggled financially in 2021, you might have thought about filing for bankruptcy. But, you should know that there are good reasons to file for bankruptcy now instead of waiting.

Here are two reasons you should file for bankruptcy right away:

Beat the Rush to the Bankruptcy Courts

Experts expected bankruptcies to skyrocket in 2020 and 2021 due to the extraordinary economic effects of the COVID-19 pandemic. Many businesses did close, but bankruptcies actually dropped in 2020 and 2021.

Bankruptcy experts attribute this drop to the financial assistance offered by federal, state, and local governments during the pandemic. Relief funds, business loans, and bumps in unemployment benefits helped businesses and individuals to weather the economic turmoil.

But, most of these programs have now expired, which could lead to an increase in bankruptcy filings in 2022.

By filing now, you might get through your bankruptcy faster. The crush of work awaiting bankruptcy judges, trustees, and lawyers could slow your case to a crawl if you wait.

Expiration of Debt Relief Measures

Several measures intended to reduce the number of bankruptcies are scheduled to expire in 2022. For example, the eviction and foreclosure moratorium has already expired.

A newer rule limited foreclosures of federally-backed mortgages. The rule requires lenders to refrain from starting foreclosures until they worked with the borrower to get caught up on their mortgage. This had the effect of delaying foreclosures until January 1, 2022.

The Florida legislature did not change the state’s debt collection laws due to the pandemic. But, some lenders voluntarily eased their debt collection efforts because they did business in states that blocked or restricted debt collection during the pandemic.

Many of these restrictions have now ended, which means that debt collections will likely return to their normal levels in 2022.

To discuss the financial issues you have faced in 2021 and whether debt collection relief or bankruptcy might work for you, contact Shrader Law, PLLC at 813-360-1529 today.