Bankruptcy And Society
The Phoenix bankruptcy lawyers at Want A Fresh Start know the prospect of filing for bankruptcy in Arizona can be troubling for some. Court-mandated financial assistance can sometimes carry a social stigma that may make the decision to file for bankruptcy a difficult one, no matter how respectable the reason. This, however, is nothing more than a collective misinterpretation of the system. Bankruptcy stands in stark contrast to state-assisted programs, such as welfare, in almost every imaginable way.
Bankruptcy Is an Old Institution
Far from a new mode of caring for citizens, bankruptcy was established by the United States government in the 1800s as a way to protect those in serious debt from the inevitable destitution that can follow financial ruin. This legislation, called The Bankruptcy Act of 1898, aimed to provide a fresh start to debtors and strike a balance between the rights of the debtors and the rights of the credit companies. As society has grown, more allotments have been made on the side of the debtors, but the process itself has been mandated by the federal government as a form of relief for over a hundred years.
The Potential for Bankruptcy Is Built Into Creditors’ Business Models
Far from a surprise, each credit company is well aware of the risk for bankruptcy from its credit card holders. Credit cards have become increasingly easy to obtain because the companies financially benefit from extra exposure and participation, even with the percentage of people who default on their payments. It would be possible for a creditor or bank to only lend money to those who are completely without risk, but this would decrease their potential scope greatly and thereby limit their earning potential. While creditors are certainly not seeking those who would file for bankruptcy, they are not actively avoiding them either. If you have accumulated extreme debt on your credit cards and are having trouble making payments with your current income, you may wish to speak with a bankruptcy attorney in Phoenix, AZ.