Bankruptcy for Unpaid Workers in Chicago Who Run Out of Money
The current government shutdown causes people to ask themselves what would happen if they did not receive their paycheck for several weeks or longer. For families living on budgets, not receiving pay means the bills are not going to be paid. Unpaid workers without savings to temporary replace regular income can lose their homes, cars and credit cards if payments are delinquent.
Even though currently unpaid government workers are promised to receive their back pay after the shutdown, they may not be paying their mortgage, rent, car payment, student loans, utilities and other financial obligations. How long would you be able to continue without pay and the immediate need to get another source of income.
In many cases the unpaid workers with specialized work skills and experience cannot find another job very easily, and not at the same pay grade.
Read an article by CNBC focused on 800,000 workers without pay and the impact of the shutdown: “Workers going unpaid during the shutdown owe $438 million in rent and mortgage payments this month.”
Examples of Situations Causing Unpaid Workers Who Consider Bankruptcy
Workers are unpaid for a variety of reasons. Layoffs happen in manufacturing due to slow business or problems. Companies with a cash flow problem may not be able to pay their workers on time. Sometimes a struggling company does not have enough money in the bank for all the payroll checks to clear. In other cases, the employers accounts could be seized or frozen. For people working as contractors for others, one party may refuse to pay because they have an issue with the work not being performed correctly. In each of these scenarios, the unpaid employee still needs to pay their bills.
Unless workers have several months of bill paying money set aside for cash flow emergencies, they may be considering their bankruptcy options. Chapter 7 and Chapter 13 bankruptcies have features and options that will help people and their families.
The Automatic Stay Provision of the Bankruptcy Code Stops Creditors from Contacting You
Creditors and bill collectors are aggressive and persistent. Economic conditions like a government shutdown mean that many workers will not get their paychecks. After the bills come due and are not paid, collectors have options. Some waive late fees and extend due dates. Temporary relief runs out at some point. Aggressive bill collectors want you to pay them before you pay someone else. They will call you and send extra past due notices in the mail. When friends or relatives listed as references on loans getting phone calls about you not paying your bill it can be embarrassing and aggravating.
The “Automatic Stay” stops bill collectors in their tracks. When either a Chapter 7 or Chapter 13 bankruptcy case is filed, including a list of all the creditors the filer may owe, those creditors receive notice that they may not continue any collection activity so long as the bankruptcy case is ongoing.
Save your home from foreclosure and sale by filing for bankruptcy, taking advantage of the automatic stay. The bankruptcy postpones foreclosures and sales.
Our Bankruptcy Blogger article explains the automatic stay in further detail: The Automatic Stay: It Stops Bill Collectors in Their Tracks. Call Joseph Wrobel, Ltd. today to get more information (312) 781-0996.
Chapter 7 Bankruptcy for Unpaid Workers
For some unpaid workers a Chapter 7 bankruptcy case might have already been on their mind. When people have debt, they cannot afford to pay, when they are making less income than before, and when the outlook for paying off all the debt is bleak, a fresh start with a Chapter 7 bankruptcy can make a major difference for a family struggling with money and bills.
The point someone who already has financial troubles doesn’t receive their paycheck, a Chapter 7 bankruptcy will help. Eliminate the credit card debt, the payments for a car worth less than owed. Eliminate the mortgage on the house that is too big and expensive.
When people start over after a Chapter 7 bankruptcy, they can control their budgets and not get behind in debt. And when people no longer owe money to so many creditors, they become a better credit risk. Rebuilding credit after a bankruptcy takes some time but is easier than people think.
Learn more about rebuilding credit. Read our article, Good Credit After Bankruptcy on the Bankruptcy Blogger section of the Joseph Wrobel, Ltd website. See also results for searching our site for the word “credit.”
Chapter 13 Bankruptcy for Unpaid Workers
Chapter 13 bankruptcy may be attractive to unpaid workers who expect to receive their back pay but who need temporary protection from collections and foreclosures. When you file for a Chapter 13 bankruptcy you can “cure” your mortgage default by making up past payments over months.
A Chapter 13 “reorganization” bankruptcy can last three to five years, giving the unpaid employee time to catch up on debts when the paychecks stopped coming for whatever reason.
One misconception about Chapter 13 is that every dollar owed must be repaid. In fact, depending on a person’s financial calculations, they may only have to repay a percentage of the amount owed.
To save your home, car and other assets you don’t want liquidated, call Joseph Wrobel, Ltd. and learn where you stand and for which type of bankruptcy you qualify. Call day or night (312) 781-0996.
Joseph Wrobel Can Help if Bankruptcy Makes Sense and Will Help Unpaid Workers Get a Fresh Start
When you call Chicago bankruptcy lawyer Joseph Wrobel and make an appointment at one of the conveniently located offices around the Chicago area you are taking the next step in finding out if bankruptcy is the right thing to save you from money problems.
At your meeting with Joseph Wrobel when your financial information is processed, he will tell you about your options under the bankruptcy law. If you or a friend is an unpaid employee because of a shutdown, lack of business, layoff or any reason, contact online or call Joseph Wrobel, Ltd. today and get the information about bankruptcy for unpaid workers, to turn off the bill collectors and turn on your fresh financial start. The main Chicago office telephone number is (312) 781-0996.