How the COVID-19 Crisis Might Lead to Bankruptcy Cases
COVID-19, more commonly known as the coronavirus, has quickly been wreaking havoc across the country and around the world – ravaging our health, healthy systems, and economies. With the disruption to the economy from the coronavirus comes employment loss, missing paychecks, and general financial stress. The problem is made even more complicated by the fact that a world health emergency of this size and scope is virtually unprecedented, and new outbreaks of the virus (not to mention new states of emergency around the world) are reported on the news every day. The crisis comes with record unemployment application filings and business closures that can lead to upcoming bankruptcy declarations.
Generally speaking, even in a pandemic situation such as the one we are currently facing, bankruptcy should always be viewed as the option of last resort. Still, in some circumstances, it may make sense to file a petition for Chapter 7 bankruptcy.
If you are thinking about declaring bankruptcy, either personally or for your small business (without employees), the experienced California bankruptcy attorneys at Miranda, Magden & Miranda, LLP, are here to assist you at this difficult time. Our legal team is prepared to review your financial circumstances and help you decide whether you should declare bankruptcy. Please give us a call today to learn more about how we can help you through the process.
Ways that the COVID-19 Pandemic is Affecting Individuals and Small Businesses
The financial and economic impacts of the COVID-19 pandemic are unprecedented. Never in our lifetimes have we seen a global health crisis with such grand-scale economic proportions. Unfortunately, the pandemic is making its strongest impact on individuals and small businesses. The pandemic is affecting individual finances in the following ways:
- Loss of jobs and a steady paycheck
- Inability to meet financial obligations, especially with regard to unsecured debt (including credit cards)
- Ever-increasing medical bills that individuals are unable to pay (especially among those who do not currently have health insurance or whose health insurance does not cover the treatment at hand)
The pandemic is also impacting small businesses in the following ways:
- Consumers are less likely to spend money on non-essential items for fear of losing their jobs or other sources of income
- Due to losing customers, businesses are having to lay some (or all) employees off
- Businesses are being forced to close their physical locations (and sometimes close altogether) due to state orders and/or a lack of financial support by customers
How Filing for a Chapter 7 Bankruptcy May Help
Again, you should not rush into filing a Chapter 7 bankruptcy petition. Still, filing for bankruptcy can be beneficial under some specific circumstances, including the following:
- It will reduce and sometimes even wipe away large medical bills in their entirety
- It will stop many creditors and debt collectors from harassing you on a regular basis
- It will help to restore essential services, such as electricity
- It can help to end garnishment of your wages
Speak with an Experienced California Bankruptcy Attorney about Your Concerns Today
The lawyers at Miranda, Magden & Miranda, LLP, can help you determine if you should file for Chapter 7 bankruptcy. To schedule a free case evaluation and legal consultation with a California bankruptcy lawyer, please contact us to learn more information about how we can help.