Is There Always a Benefit to Filing for Bankruptcy Protection?


Is Doing Nothing Ever a Good Option?

When you are facing a dire financial situation—you’ve lost your job, have incurred substantial medical expenses, or are in the middle of a costly divorce—bankruptcy can seem like a really good option. You’ll get the benefit of the automatic stay and, hopefully, you’ll be able to discharge most of your debts. But is bankruptcy always a good choice? Are there times where you might consider avoiding the cost and hassle of a bankruptcy filing?

When You Are Judgment Proof

One of the principal reasons for filing for bankruptcy protection is to protect what little you have. You don’t want to worry that a creditor will file a lawsuit, obtain a judgment and seize your property. But a judgment is only effective if a creditor can collect on it. You may be considered “judgment proof,” i.e., without the resources to satisfy any debt. If the following criteria are present, your creditors are likely without recourse to satisfy a judgment:

  • You have no income (or the income you have is exempt from judgment—government benefits, for example)
  • You don’t own any assets of value
  • You have no equity interest in any real property

Bankruptcy Has Limited Application to Some Debts

One of the purposes of bankruptcy is to eliminate or renegotiate existing debts, so that you can start over. Not all debts are subject to discharge or reorganization, though. You can’t use a bankruptcy filing to discharge or restructure any type of child or spousal support arrearage. Most student loans are not subject to discharge and it’s also extremely difficult to rid yourself of most tax obligations.

Contact Heath, TX Bankruptcy Attorney Carrie Weir

I provide a free initial consultation to anyone with questions or concerns regarding a bankruptcy filing. Contact my office by e-mail or call me at 972-772-3083 for a private meeting. With offices in Rockwall, Texas, I represent clients in Heath, Greenville, Lavon, Wylie, Mesquite and Rowlett.

Speak Your Mind


Call Rockwall bankruptcy lawyer Carrie Weir at 972-772-3083 or fill out the contact from below for a free, confidential consultation to discuss your options.

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