The world is experiencing a global pandemic with the rapid spread of the coronavirus causing cases of COVID-19. Dozens of cases have been reported in Texas, even here in Frisco, and the number is likely to grow as more people are able to be tested. While the public health threat is the priority, there are also concerns about the economic impact it will have. Businesses around the world are shutting down to the public, and the stock market has dropped to historic lows. If the economic effects of the coronavirus pandemic cause you to fall behind on your debts, you may want to consider bankruptcy as a source of relief. If you have an ongoing bankruptcy case, you need to watch for how the pandemic may affect your case.
Virus Impact on Personal Finances
To prevent the spread of the virus, many offices, stores, and restaurants are closing – either voluntarily or by government mandate. Employees may be okay if they can work from home or their employer is willing to pay them during their time off. However:
- Some workers are going unpaid or are having their payments deferred while their employers are closed.
- Small business owners may see decreased revenues that hurt their personal finances.
- There is no telling how long employers will continue to pay workers who are on leave.
People who live paycheck-to-paycheck or are desperately trying to keep up with debt payments may not be able to afford a gap in their income. Creditors may show more patience given the extraordinary circumstances but are not required to do so. If a creditor is threatening to repossess your property or file a lawsuit against you, filing for bankruptcy will put an immediate stop to it and allow you to manage your debts.
Virus Impact on Current Bankruptcy Cases
People who file for Chapter 13 bankruptcy must make regular payments to the bankruptcy trustee as part of the repayment plan. Your monthly payments are based in part on your income. If your income is reduced for a month, you may be unable to make your monthly bankruptcy payment, which could be grounds for the trustee to request that your case be dismissed. You need to immediately speak with a bankruptcy lawyer if you know that there will be a gap in your pay because of the pandemic. This is a novel situation that we are experiencing in our nation and the court system and the trustees are working diligently on how to handle the problems that may arise.
Contact a Denton County Bankruptcy Attorney
The threat of the coronavirus has made people worried about their health and their financial security. At the Page Law Firm, we are prepared to help you with the latter if you need relief from your creditors. A Frisco, Texas, bankruptcy lawyer is available for a free consultation by calling 214-618-2101.