How Coronavirus Is Impacting Debt and Bankruptcy

How Coronavirus Is Impacting Debt and Bankruptcy

April 1, 2020

As the coronavirus pandemic takes over the world, many Americans find themselves laid off or otherwise without a way to make ends meet. This leaves the question about how to deal with the bills—if you have current debts or a bankruptcy proceeding, what will happen to you during the coronavirus outbreak in Montgomery County, TX?

What to do if you’re in debt—could bankruptcy be right for you?

With credit card, rent, mortgage and other debts piling up and no way to earn more money, many Americans are struggling to survive right now. The one-time $1,200 stimulus check promised from the federal government can only go so far—in high-cost-of-living areas, that may not even cover rent for a month. Plus, few companies are currently hiring, and no one knows how long the national shutdown will continue. It’s hard not to worry.

The first thing you should do is call your current lenders—student loan lenders, mortgage companies, utility, car loan and credit card companies, banks and more—and inform them of the situation. Most lenders are aware of and sympathetic to what’s going on, and realize that they won’t be able to collect payments from a number of people until the economy is back on track. Mortgage companies have a 60-day foreclosure moratorium, and in many places, evictions are halted for inability to pay until further notice.

Depending on how long the national shutdown continues, you could still find yourself butting up against the allowances made. If the debt keeps piling up and you have no way to pay, you may want to consult with a bankruptcy attorney to discuss your options.

What happens if you have a current bankruptcy case

If you already have a bankruptcy case in process, call your attorney immediately. In Chapter 13 cases, you’re required to make a minimum monthly payment—and if you fail to pay, that’s grounds for the trustee to dismiss your case. Luckily, most courts are sympathetic to these unprecedented circumstances, so if you have been laid off and are currently unable to pay your bankruptcy installments, you need to act fast. Your bankruptcy management attorney in Montgomery County, TX can contact your trustee and inform them of the situation. They should be able to work out a solution on your behalf.

Whatever you do, don’t let inaction ruin your finances and future prospects. If you have any kind of debt, you or your lawyer should speak to your lenders right away.

Bankruptcy management in Montgomery County, TX

If you’re struggling to make ends meet amidst the coronavirus outbreak, you’re not alone—James R. Jones, Attorney at Law can help. Our team is experienced in dealing with individual and business bankruptcies, and are licensed in all state courts as well as the United States District and Bankruptcy Courts in the Southern District of Texas and the United States Court of Appeals for the 5th Circuit. Reach out to us today for a free consultation. We look forward to assisting you during this challenging and confusing time.

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