There are both advantages and disadvantages to filing bankruptcy in Alabama. While it’s inevitable that bankruptcy will have a significant impact on your credit score, it can also help you eliminate debt you know you can’t afford to pay back. 

Fortunately, there are experienced bankruptcy attorneys in Alabama who can help you weigh the pros and cons, and help you decide if declaring bankruptcy is the best option for you.


Some view bankruptcy as a bad thing based on how it affects your credit score


If you file for bankruptcy, whether you choose Chapter 13 or Chapter 7, it will impact your credit score. Lenders will likely view you as a risk and deny you access to lines of credit and/or loans. To make matters worse, bankruptcy will remain on your credit report for several years.

While Chapter 7 bankruptcy stays on your credit report for 10 years, Chapter 13 falls off after seven years, from the date you filed (1). Although that may sound a little scary, you will be able to build your credit score back up, even with the bankruptcy still listed on your report, allowing you to be viewed as less of a risk to lenders. 

However, this all takes time, patience, and a good understanding of how to repair your credit. 


You may also have to liquidate assets if you file for bankruptcy


When you file for Chapter 7 bankruptcy, you’ll need to liquidate some of your assets in order to satisfy some of the debt you owe. While the court will generally allow you to exempt certain property from liquidation such as your house and vehicle, you run the risk of having to give up certain property–and a Leeds, Alabama bankruptcy lawyer can inform you on what this is.

The good news, however, is that if you have leftover debt and it qualifies for exemption, it could be wiped off your record. This means you would no longer be obligated to satisfy the debts you owe once all of the conditions of the bankruptcy filing are met.

Although bankruptcy tends to carry a negative connotation, it can help individuals who are drowning in debt start over with a clean slate. It can also provide individuals and businesses with protection from civil lawsuits, particularly those filed on behalf of creditors.


Drowning in debt and don’t see a way out?


If you’ve fallen into a financial rut and are considering bankruptcy, you’ll want to consult with a bankruptcy lawyer in Leeds, AL. An attorney can review your circumstances, determine if you qualify for bankruptcy, and help you make an informed decision as to whether you should file.

Hill, Gossett, Kemp & Hufford, P.C. is a bankruptcy law firm in Alabama that can address your questions and concerns, and even get you started with the bankruptcy process.


Disclaimer: No representation is made that quality of legal services provided is greater than the quality of legal services provided by other attorneys.


Hill, Gossett, Kemp & Hufford, P.C. can be reached at:


Moody Office

2603 Moody Parkway, Suite 200

Moody, Alabama 35004

Phone: (205) 640-2000



Leeds Office

7900 Parkway Drive

Leeds, AL 35094

Phone: (205) 699-5500


Springville Office 

6441 U.S. Highway 11

Springville, Alabama 35146

Phone: (205) 467-2225


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