June 13, 2021

Bankruptcy – a Legitimate Reset Button?

Any ethical bankruptcy lawyer will tell you that filing a Chapter 7 or Chapter 13 should be your last resort. It is something that needs plenty of meaningful thought and the advice of professionals who help good people to see debt relief as achievable. There are ways to deal with debt that will not involve a filing of bankruptcy, but one size does not fit all.  The main thing to remember:  if you do nothing, the problem will not disappear.

People Who File Bankruptcy

Years ago, there was a perception that the people who file bankruptcy are somehow deadbeats or gamblers.  This is an old myth perpetrated by people who don’t have the facts.  A look at the Tennessee bankruptcy filing statistics will also dispel this myth – over the past 10 years, tens of thousands of people filed bankruptcy – and most of these are honest, hardworking men and women who found themselves facing hard times 1.

Fortunately, the numbers have already come to a peak and are now in decline. They will not go away completely because people still find that some situations are insurmountable. These situations might include – but are not limited to:

  • Unemployment of any length
  • Divorce or separation
  • Illness
  • Paying for a “want” rather than a “need”

 The Reset Button 

A bankruptcy serves as a reset financial button that allows for a second chance or a do-over. It gives back peace of mind and creates a degree of resiliency that will let a person sleep at night once again. In most cases, a bankruptcy filing does not mean that you need to surrender any of your property.

If you are thinking about bankruptcy, sit down with one or more prospective lawyers and ask questions. How many cases has the lawyer handled?  Are there any non-bankruptcy alternatives?  What could possibly go wrong?

Alternatives to Bankruptcy

Bankruptcy is not always the answer to problems arising from debt. Other solutions will receive consideration and we will advise you to consider those non-bankruptcy options. Restructuring debt might be the best route for you to follow. 

New laws about filing bankruptcy requires a presenting attorney to gather a remarkable amount of information proving income, assets, expenses and debt as well as the most recent filing of income tax returns and all pay stubs. You can be sure that privacy and confidentiality will prevail at all times. Bankruptcy might be a last resort, but realize that bad things happen to good people – bankruptcy is a legitimate financial tool and you are not acting wrongfully if you decide to file.

  1. In the middle district of Tennessee alone, more than 10,000 debtors per year file bankruptcy – see the official statistical report


Jonathan Ginsberg has been in private law practice since 1987. He writes and teaches about Chapter 7 and Chapter 13 bankruptcy protection.