As many people in Arkansas will know, no matter how carefully you plan for the future, sometimes things just go wrong. Anyone can fall into debt, given a little misfortune; the important thing is what you do next. One option is to file for bankruptcy and start afresh. Although there is a certain stigma attached to this process in the eyes of some, it can be a highly effective way of dealing with your debt problems.

TolTest, a Detroit-based firm that has handled defense contracts with the U.S. military, has chosen to file for Chapter 7 bankruptcy. A series of misfortunes, including the Kilpatrick corruption scandal have compounded the civil engineering firm’s problems in recent months. Losing valuable defense contracts further decreased the struggling firm’s potential income.

The move to file for Chapter 7 is not unusual for firms like this when they run into difficulties. The documents regarding their bankruptcy filing detail liabilities from $50 million to $100 million, with around 10,000 creditors. Last year, at least three of the firm’s defense contracts, worth more than $70 million were terminated for default. Although it has appealed the terminations, a decision has yet to be made in response to the firm’s claims, leaving them in significant financial deficit.

Although this company is based in another state, residents of Arkansas can empathize with their position. Sometimes things just don’t work out the way you hope and there is no shame in making a clean break and starting over. Filing for bankruptcy can free you from creditor harassment and protect you from collection lawsuits. An attorney can advise you on the best options for you and guide you through the process.

Source: Crain’s Detroit Business, “Lakeshore TolTest files Chapter 7 bankruptcy,” Chad Halcom, May 5, 2014