Everyone experiences financial hardship at one point or another. However, serious issues that affect your finances may be signs that you need professional help. An estimated 794,960 bankruptcy cases were filed in 2016, so you should not feel alone if you believe bankruptcy may be right for you. Of course, knowing the signs that you're ready for bankruptcy will help you understand if it is time to consult an attorney. If you are experiencing one or more of the following signs, bankruptcy may be the right decision for you and your financial future.
Creditors Are Calling Daily
You may think you can dodge letters and phone calls from creditors periodically, but ignoring these attempts at collecting debts cannot go on forever. In addition, after a certain period of time, creditors may send debts to collection agencies, and even attorneys, who will use legal force to collect on these debts. Starting the process of filing bankruptcy will stop the harassment from creditors almost immediately. Therefore, if you feel paying these debts and collections is not possible, bankruptcy is probably the right thing for you.
Wages May Be Garnished/Bank Accounts May Be Levied
If you fail to pay your debts, they will eventually move into collections, which can be taken care of by collection agencies and even the court systems. Judgments can be placed on you for debts that you fail to pay in certain states. Once the judgement process begins, a sheriff will serve you papers notifying you that more severe consequences will be taken if you continue to ignore the debt.
If the judgment is finalized, the courts may garnish your wages or levy your bank account for all or a portion of the total debt owed. If you have been served or have already had your wages or bank account garnished, consult a bankruptcy attorney immediately for assistance.
You May Lose Your Home
Whether you have become ill and unable to work or you have lost all or some of your income, paying the mortgage may be challenging. Since it is an investment, you should do whatever it takes to keep your home, and filing bankruptcy may be the only thing that can help.
When filing chapter 7, an automatic stay will stop the foreclosure process until the bankruptcy has been approved and finalized. If you are filing chapter 13, this repayment type of bankruptcy will design a monthly payment plan that allows you to keep your home and pay the mortgage and your debts in a more affordable and realistic manner.
Filing bankruptcy does not have to be a complicated process. With the help of a bankruptcy lawyer and this guide, you will learn the signs that it is time to consider filing.