Do you currently have more debt than you can pay back? Your tax refund might help you get rid of all of it, even if your tax refund doesn’t cover the total amount of debt. Here’s how.
The past two years have been incredibly difficult (to make an understatement). On top of navigating the pandemic, many people in Louisville, KY, and across the nation, had their hours cut or lost their jobs altogether.
If that happened to you, you’re not alone. Millions of Americans had a drastic reduction in income due to sickness and or job loss, and (understandably) they turned to credit cards to help keep them afloat financially.
While credit cards can be incredibly beneficial to get through a brief financial rough patch, they can cause stress when used long-term, since the minimum monthly payments can become too much to bear as the total balance continues to increase.
These past two years have put people between a rock and a hard place by presenting then with two difficult decisions — they either don’t pay their bills, and lose their home, car, and other assets, or they use credit cards to stay afloat, but get to a place where they can’t catch up in paying them back, and possibly still end up in a situation where their home goes into foreclosure or their car gets repossessed.
It’s incredibly heartbreaking, and often seems like there’s no hope.
I’m here to tell you that there’s hope, and it can start with your tax refund. You might be thinking, “My tax refund is only $1,800, and I have $20,000 of debt. How can my tax refund help when it’ll barely take care of 10% of my debt?”
That’s a great question. If you had a small amount of credit card debt, you could just directly pay it off with your tax refund, but if your refund is way smaller than your total debt balance, it probably still seems like you’re stuck. The good news is that you can use your tax refund to file for a personal bankruptcy to help you get a fresh start financially.
Now you may be thinking, “How is that good news? Won’t bankruptcy ruin my life?” That’s a valid question, and the straightforward answer is: No, bankruptcy won’t ruin your financial future. In fact, it can help you save your house and your car, while also permanently getting rid of your credit card debt!
And in regards to your future credit, once you complete your bankruptcy plan, you can rebuild your credit within two years, as long as you pay all of your bills on time (such as your mortgage, car payment, utilities, and so on),
Now you might be thinking, “Okay, that’s a relief to hear, but how does all of this tie into my tax refunds?” That’s another great question. When filing for bankruptcy, there are filing fees and attorney fees that have to paid upfront in order to officially file your case with the Court. If you don’t have any extra money right now, you can use your tax refund money to pay for those fees.
Overall, using your tax refund money to cover the cost of filing fees for your Kentucky bankruptcy is a smart move when you consider the multiple benefits of bankruptcy:
1.) Your creditors will stop contacting you. Once you file for bankruptcy, your creditors are not allowed to call you multiple times a day or send harassing letters in the mail, and they can’t take money out of your paycheck or bank account!
2.) You can protect your home and your car. If your home is in danger of foreclosure, or your car is going to be repossessed, bankruptcy can put a stop to that!
3.) You get to keep all of the money in your paychecks. If a creditor has sued you and has obtained the right to take 25% of each of your pay checks (called a “wage garnishment”), bankruptcy can put a stop to that too!
If you’d like to find out if bankruptcy would help your specific situation, I offer free phone consultations, and can often do same-day appointments for those phone calls.
With 22 years of experience as a Louisville bankruptcy attorney, I can help you determine whether or not bankruptcy can give you the financial freedom you’ve been looking for.
The best part is that you can reach me directly on my cell phone. To set up a free consultation, please call or text me at (502) 435-2593, or fill out the contact form below.
If you’re ready to get on a path to a debt-free life, your tax refund may be the first step in getting you there, and I’ll help you take care of the rest!
All the best,
Tracy L. Hirsch
*Disclaimer: This blog post is purely informational, and should not be construed as legal advice. If you have debt and want to learn more about your options, meet with an experienced bankruptcy attorney in Louisville, Kentucky to find out what would work best for you.
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