Financial struggles have a domino effect on every other area of your life. When you start falling behind on bills, the mental stress makes it harder to take care of other responsibilities. As more and more of your income gets absorbed by debt, you may find it harder to feed yourself and get to and from work. If you fail to pay parking tickets and other traffic tickets, you could lose your license and find yourself completely unable to pay your bills.
At this point, you’re looking for a fresh start. Could bankruptcy be what you need? Learn more now by contacting Padgett & Robertson at 251-342-0264.
Debts That Cause You to Lose Your License
Traffic tickets are taken seriously in most states. If you don’t pay by the deadline, you start incurring late fees, interest, and more. When you continue to leave them unpaid, the state starts taking more serious action against you. They may suspend or revoke your license until you’re current.
Once it gets to this point, you’re looking at a serious amount of debt. Not only do you have to pay the initial cost of the tickets, but you also have to pay the late fees that have been accruing the entire time.
Are These Debts Dischargeable in Bankruptcy?
Unfortunately, these debts are not dischargeable in bankruptcy. Fines owed to a governmental entity are not discharged in Chapter 7 or Chapter 13 bankruptcy. Even if your other debts are wiped out, you will still be responsible for everything you owe to the state. This means that your license will continue to be suspended after your bankruptcy is granted.
How You Can Use Bankruptcy to Get Your License Back
While declaring bankruptcy does not directly clear up your traffic tickets and get you your license back, it does indirectly allow you to do so. Let’s say you’re paying $350 per month in credit card minimum payments and $200 per month on a personal loan. These payments are straining your budget to its limits and leaving you with absolutely nothing leftover to pay off your tickets.
Once your debts are discharged through bankruptcy, that leaves you with a lot more disposable income to use as you see fit. In this situation, the responsible thing to do would be to put as much of that disposable income as possible toward your tickets and late fees. The more quickly you pay off those debts, the more quickly you can get your driver’s license back.
This process is a little different if you pursue a Chapter 13 bankruptcy. In Chapter 7, your dischargeable debts are completely wiped out. In Chapter 13 bankruptcy, your debts are structured in a way that helps you pay off a percentage of your debt over a period of three to five years. You can include the debt that caused you to lose your license in your repayment plan. Of course, this does not pay off those debts right away. However, you still may be able to get your license back if you can prove that you are taking steps to pay everything you owe.
Bankruptcy is an extremely complex area of law, so it’s important to avoid taking a DIY approach to your claim. Doing so could lead to your debt discharge being denied or having your assets seized. Furthermore, paying debts while going through bankruptcy can raise questions as to whether or not you truly need to file for bankruptcy.
That’s why it’s important to work with an attorney through this process. Your attorney can listen to your concerns, tell you what can and cannot be discharged, and help you come up with a plan moving forward. They will let you know what payments you can make to get your license back and give you an approximate timeline. You can look forward to the future, knowing that it includes a reinstated driver’s license and a debt-free restart.
Discuss Your Next Steps with Padgett & Robertson
Are you ready to find out whether or not bankruptcy is the right choice for you? The team at Padgett & Robertson is ready to talk to you more about your finances and help you understand your options. Set up a consultation right away by or giving us a call at 251-342-0264.