If you've accumulated a large amount of debt and struggle to make ends meet, bankruptcy might be the best solution for your problem. You could stay stuck in a financial disaster for years when you have credit card debt because constantly falling behind and making minimum payments makes it nearly impossible to pay off your debt. That can cripple your finances and ruin your chance at a decent retirement. A bankruptcy attorney can look over your financial situation and decide if bankruptcy is a good option for you. Here are some things to think about.
How Bankruptcy Affects Your Credit
While a bankruptcy is a serious blow to your credit, if you're struggling to pay your bills and missing payments frequently, then your credit is probably damaged already. Not only that, if you don't get relief through bankruptcy, then late payment hits could continue for years to come until you can turn your financial picture around. A bankruptcy clears the slate so you stop accumulating more bad marks as long as you keep current with your bills after bankruptcy.
Bankruptcy Could Improve Your Financial Picture
One reason it's important to discuss bankruptcy with an attorney is so you understand how it will affect you personally, and how it will affect your financial future. If you're close to retirement age, then protecting your retirement money and saving could be better than struggling to pay off debt when there's nothing left for savings or to buy medications and other important things you need. If you're young and single and have time to bounce back and build a strong financial future, then an attorney might have different advice. Your attorney will explain the pros and cons of bankruptcy as well as possible alternatives, so you make an informed decision and not do anything that makes your financial situation worse.
Know What Not To Do Before You File
When you're contemplating bankruptcy, it's a good idea to talk to an attorney well in advance of filing. Although, you may need to act fast if you've missed several payments and your creditors are threatening to sue. If you're still juggling and trying to pay off your debt, then by talking to an attorney, you'll learn about things you don't want to do before you file. This might include showing preference to a particular lender by paying off their bill and avoiding paying others, transferring a car title to a relative so you won't lose it in bankruptcy, and taking out new credit. Actions like these might come back to haunt you and complicate your bankruptcy case. Seeking advice from an attorney gives you the best chance at eliminating your crushing debt the right way, so you can focus on saving and building a better future.