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Coronavirus (COVID-19) Stimulus Check: Best Bang for Your Buck

Coronavirus (COVID-19) Stimulus Check: Best Bang for Your BuckJust recently, the US Senate and House of Representatives passed and President Trump signed an economic relief package in response to the looming recession created by COVID-19. One of the most important features of that bill is a financial relief check cut by the government for millions of individuals and families. Specifically, it’s being reported that direct relief payments of up to $3000 per family will be paid out, possibly as soon as within three weeks. This is welcome news for many people. It will inject money into the economy and provide a buffer for those who weren’t struggling before the pandemic hit. For those who were struggling financially to begin with, however, a one-time payout is insufficient. What was difficult before becomes impossible now.  Even the full payout of $3000 won’t keep a roof overhead or food on the table for long, much less keep creditors figuratively banging down the door, blowing up your phone, filing a lawsuit, garnishing wages and bank accounts, repossessing vehicles or other property, or foreclosing on your home (some of these actions are prohibited for now, but will eventually become allowed again).One way to stretch that relief check so that it genuinely gives you some relief is to consider if you need to file for bankruptcy. Bankruptcy lifts the financial burdens that weigh down those who are in over their heads. We all face difficult times and an uncertain future, so why carry debt that was drowning you before the economy shut down?For those who don’t have a mortgage (and even for some who do), Chapter 7 bankruptcy often provides the best form of debt relief. Because Chapter 7 wipes clean all the debt you owe, including any debt you may owe to the law firm that filed your chapter 7 bankruptcy, the only ethical way an attorney can accept payment for helping someone file Chapter 7 is if the payment is upfront.  The ethical considerations impacting the payment of fees on a Chapter 7 bankruptcy prohibit an attorney from accepting payment after a Chapter 7 is filed because that attorney cannot take money from a client that is no longer owed to that attorney. Since Chapter 7 bankruptcy is the optimal type of bankruptcy for many individuals, this one-time lump sum stimulus payment may provide a rare and unique ability for someone in certain circumstances to file bankruptcy.  Rather than pay off just part of one debt with the economic relief check, a better bang for your buck could be to discharge potentially all your debts by filing bankruptcy.If you’re one who would benefit more from a Chapter 13 bankruptcy, it’s still a good idea to consult a qualified Kansas bankruptcy attorney to ensure wise spenddown of that money so that a bankruptcy trustee won’t be able to seize that relief check from you or from any creditor you might pay.  Please contact us today to learn more. In response to the pandemic, we are now offering virtual consultations to keep you safe and healthy.
 

Disclaimer

These articles are for general informational use and do not constitute legal advice. Since laws change over time, it’s possible some articles are out of date and for that reason, we make no representation that the articles are fully accurate. For actual, up-to-date legal advice (including a free consultation), please contact us!