The period after the holidays and leading into Spring is normally the busiest time of year for bankruptcy attorneys.
It makes sense in a lot of ways. First of all, not many people want to deal with debt and credit issues during the holidays. Which is entirely understandable. So, it is often put off until the next year sometime after New Year’s.
Another reason it is a busy time of year is because people will make resolutions to clear up their debt and credit issues. A fresh year is a good time for a fresh start. I have many new clients during this time of year who will say as much.
A less obvious reason that this is a busy time of year for bankruptcy filings is that many people are able to use their tax refunds to pay the filing fees and costs. Some clients on payment plans are able to finish them up once they receive their tax refund. You tax refund may be earmarked for repairs, household expenses, or utilities. But, using it to file bankruptcy may make your entire year easier and less stressful.
The most unfortunate reason that bankruptcies pick up in the Spring is that foreclosure actions tend to spike during the Spring. This may be especially true in 2022 as mortgage companies are once again allowed to foreclose on homes after the lengthy COVID moratorium. A Chapter 13 bankruptcy is a great way to stop a foreclosure. It allows you to catch up all arrears and fees spread out over 3 to 5 years. Even more importantly it will stop a foreclosure or even a sheriff sale up until the final moment of the action. Your home need not be in danger.
All of these reasons tend to cause bankruptcies to increase at the beginning of the year. However, it’s no reason to despair. As mentioned earlier, New Year’s is a great time for a fresh start. With the holidays behind us it is often times a good moment to get our affairs in order. If you’ve been considering filing bankruptcy, but put it off because of the holidays, call us at 412-414-9366 to set up a free consultation and see if it’s a viable option for you. The new year is a great time to end the stress related to creditors and collection actions.