Many times, debtors aren’t sure whether filing bankruptcy will really help their situation or hurt them. The word bankruptcy has a tinge of negativity to it. History shows that the word comes from the Latin terms bancus (a bench or table), and ruptus (broken). Additionally, Italians have been known to use the word “bancarupta”which means bench broken or bank broken quite often when a banker/tradesman could not make good on his debts. So it is understandable when people try to find other ways to fix their financial problems other than going bankrupt. Many will use up all of their retirement savings just to avoid bankruptcy. Many do not understand that bankruptcy does provide protection. Protection from unscrupulous creditors and a way to protect a debtor’s assets. Spiritually, Deuteronomy, Chapter 15, Verses 1-2 says, “1 At the end of every seven years thou shalt make a release. 2 And this is the manner of the release: Every creditor that lendeth ought unto his neighbour shall release it; he shall not exact it of his neighbour, or of his brother; because it is called the LORD’S release.”
Bankruptcy is financially non-discriminate. It provides relief for those who, through no fault of their own, have fallen on hard financial times as well as those who have abused their financial advantages. There are, of course, exceptions where people have either broken or abused the rules. Bankruptcy provides a way to clear out the financial baggage that many carry and release the stress that builds from that baggage. Stress, one of major causes of health related problems, can break relationships and friendships, as well as a person’s fortitude. Relief from that stress can help a debtor regain his will to move forward – to recover.
Bankruptcy is not something that should be taken lightly. It does carry some liabilities but none that cannot be overcome. Recovery from a bankruptcy filing generally takes about 2 years. Notions that bankruptcy can ruin a person’s credit forever are groundless. Many have filed, found the relief that they so desperately needed and have moved on to a more financially stable life. Just ask the roughly1.5 million who filed last year.