Bankruptcy is an extremely important part of our financial laws, allowing for a hard reset in instances when circumstances or unwise choices lead an individual to unbearable financial strain. The possibility of bankruptcy itself affects the way that interests rates for various types of lending get calculated, as lenders all have to account for bankruptcy when considering risk of the loan. When a person or private organization finds themselves sufficiently sideways financially, bankruptcy allows a pressure release valve. However, bankruptcy does have its limits.
Currently, the law does not provide many clean options for some institutions to seek bankruptcy. Only a decade ago, the country’s financial systems nearly came apart as the housing markets collapsed and other elements of the economy dove sharply. Banks, as central players in the entire financial industry, cause huge disruptions if they seek bankruptcy.
States and countries also do not fit neatly under bankruptcy provisions. Over the last several years, a number of countries have undergone de facto bankruptcies, causing seismic shifts in many aspects of the global financial system. The utilities of bankruptcy simply do not function properly at these scales in size and complexity under current financial laws.
Fortunately, bankruptcies sought by individuals do operate excellently under the law, granting many businesses and private consumers relief in seasons of financial difficulty. If you face a financial burden that is too much to bear or threatens to sink your livelihood, don’t wait to reach out to an experienced bankruptcy attorney. Professional guidance through your bankruptcy options can help you identify which bankruptcy process meets your needs and priorities, while protecting your rights throughout the process.