Is Bankruptcy the Best Choice for Me?
The protection offered by the U.S. Bankruptcy court may be able to help you get back on your feet if you're struggling with debt and overwhelmed by your financial obligations. But it's not always the right choice for everyone.
Bankruptcy is designed to help people in extreme financial situations, including those dealing with unemployment or a sudden health issues. No two situations are the same though. Let an attorney evaluate yours, and help you determine if bankruptcy might be the best solution for you.
You can schedule a free, no-obligation consultation today by filling out the quick case review form below. Take action now and see if bankruptcy is right for you.
Bankruptcy Often Works When...
You want to stop foreclosure
If your house is in danger of being foreclosed upon, filing for Chapter 13 bankruptcy may prevent the immediate loss of your home. Bankruptcy's automatic stay was designed to prevent all forms of collection, and since foreclosure is a kind of collection, it can often be stopped. Plus, by following Chapter 13's three- to five-year repayment plan, you could ideally get current on your mortgage.
You've been hit by a major, unexpected expense
Bankruptcy may provide relief to those who were just scraping by between paychecks and then blindsided by a major expense (divorce, injury, lawsuit, etc.). Often, people who may have been able to get by indefinitely are “pushed over the edge” by some unanticipated life change.
You're facing harassment from creditors
People whose phones ring off the hook with creditors and who've had enough, may see bankruptcy as the right choice. As soon as the bankruptcy lawyer files the petition with the court, an automatic stay usually goes into effect. This stay was designed to stop creditors of all kinds from contacting debtors. Creditors that choose to ignore this ban can face serious fines and penalties.
Bankruptcy May Not Be Best If...
You've filed bankruptcy in the past eight years
If you have another bankruptcy filing in your recent past, chances are you aren't eligible to file again. Specifically, you can only file for Chapter 7 bankruptcy once in any eight-year period and for Chapter 13 once in any six-year period, assuming you adhered to your repayment plan for the most part.
You're looking to discharge student loans, child support, alimony or tax debt
Certain types of debt are non-dischargeable in bankruptcy court, so even filing under Chapter 7 will probably not relieve you of your obligations to your children, ex-spouses, student lenders or the IRS. These types of debts may be able to be part of a repayment plan in a Chapter 13 filing, but they usually cannot be excused entirely.
You want to prevent the repossession of some asset
While bankruptcy's automatic stay can prevent creditors from contacting you while your case is pending, it cannot prevent the repossession of any asset for which you cannot pay. If you're looking to hold onto a car, for example, you'll either have to reaffirm or redeem your debt (in a Chapter 7 filing) or keep up with payments to your auto lender as outlined in your repayment plan (in a Chapter 13 filing).
Alternatives to Bankruptcy
So where can you turn if bankruptcy cannot offer the protection you need? Luckily, plenty of options exist to help Americans relieve themselves of their debt burdens. If you don't think bankruptcy is right for you, consider the following choices:
- Pay the bills by looking for ways to earn more money and/or spend less. Learning to live within a budget can work wonders on your finances. Learn more about budgeting your bills.
- Negotiate your debts by speaking directly with your creditors or working through a company designed for this purpose. Many creditors are willing to accept reduced payments from you, especially if they're likely to receive nothing at all should you file bankruptcy. Learn more about debt negotiation.
- Take on a debt consolidation loan to potentially get a lower interest rate and to reduce the number of checks you have to write each month. Debt consolidation loans allow you to make one lump payment that is then distributed among your creditors. Learn more about debt consolidation.
- Work with a credit counseling agency to help you understand and take control of your finances. Learn more about credit counseling.
- Consider debt settlement, which, in some cases, can mean huge reductions in overall payments you have to make. Learn more about debt settlement.
Want Advice? Talk to a Bankruptcy Lawyer for Free
If you still aren't sure whether or not bankruptcy is the right solution to your financial woes, you may want to talk to a bankruptcy lawyer practicing near you.
Bankruptcy Central can connect you with a local sponsoring bankruptcy attorney and all you have to do is call us at 866-288-7281 or fill out our free online case evaluation form.
Why wait? Take control of your finances today.