I have been a bankruptcy attorney long enough to have watched the economy ebb and flow numerous times. Sometimes the ebb or flow may be slow and gradual. The real estate boom of the mid 2000s was a slow ebbing bubble that was bound to break and the fallout lasted for several years. Eventually the ebb began to grow again and we have had a long period of growth. The bubble would have burst of its own accord at some point. That is the nature of economic life.
Some bubbles burst quickly and the fallout is more drastic and less predictable. We are now experiencing the most dramatic deflation of our lifetimes, all due to a microscope bug, COVID-19. We cannot minimize the deaths and severe illness caused by this virus. We do not know the long term effects on those who survive and we cannot predict how long this disease will tax our health care system.
The full economic impact of this pandemic will not be realized for a long time. However, on an individual level it has and will be financially devastating for many people. Few people or small businesses can survive the loss of income that spreads over even a month or two. The loss of income has a ripple effect. The business owner may be forced to lay off employees, but the company still has rent and other fixed costs that cannot be paid. The employee may apply for unemployment, but the wait time to qualify for benefits has become enormous. Even then, unemployment is a poor substitute for a regular paycheck. Even though rent and mortgage payments may be suspended, they will eventually come due.
Fortunately, there is a form of relief that has existed for a very long time, BANKRUPTCY. This remedy is designed to give people a way out of the debt crisis. More than ever before, this is a viable solution to get people back on their feet. A Chapter 7 will clear away all the unsecured debt that has accumulated. Chapter 13 will allow people to save their homes and cars through the protection of a court approved plan. A Chapter 11 will give a small business the opportunity to restructure its debts.
If you find that your struggle with debt has been aggravated by this pandemic, seek professional help. A competent bankruptcy attorney can help you find the best solution. You can TAKE BACK YOUR LIFE.