Bankruptcy is often viewed as a dirty word. Chances are if you are facing a mountain of debt, you’re probably asking yourself, should I file for bankruptcy? The answer depends on your personal situation, but sometimes filing for bankruptcy is the best thing you can do.
Filing for bankruptcy can provide you with a fresh start, by either eliminating your debts or restructuring them with a more reasonable repayment plan. Deciding whether or not to file for bankruptcy can be a difficult decision and it’s important to take all the consequences into consideration before you pull the trigger.
This article will break down the details of filing for bankruptcy to help you answer the question should I file for bankruptcy. Remember: when in doubt, you should consult a bankruptcy lawyer. Although this article provides some general hypothetical situations and guidance, every case is different, and a lawyer will know best whether bankruptcy is right for you.
During the process of deciding if bankruptcy is right for you, you should ask yourself a few basic questions:
1. Do I qualify for bankruptcy?
2. Can filing for bankruptcy help me?
3. Am I facing a lawsuit or repossession?
4. How much property do I own?
Do I qualify for bankruptcy?
In order to qualify for Chapter 7 bankruptcy and wipe out your debts, your income must be low enough to pass the bankruptcy means test, or the amount of your debts must not exceed a certain dollar limit. If you have higher income and cannot pass the means test, Chapter 13 bankruptcy may be an option for you. If you aren’t sure if you qualify for bankruptcy, you should consider talking with a bankruptcy lawyer to find out what options are available.
Can filing for bankruptcy help me?
This depends again on the details of your financial situation and what types of debts you have. Bankruptcy can help you There are sometimes priority debt obligations which bankruptcy does not discharge. Bankruptcy may also be more complicated than, say, settling your debts depending on how much you owe. You should think about what types of debts you have and what goals you hope bankruptcy can help achieve. Go here to read info about how to get out of debt by filing for bankruptcy.
Am I facing a lawsuit, foreclosure, or repossession?
If you are facing a lawsuit with a creditor, they could get a judgment against you and garnish your wages. Filing for bankruptcy can stop this process and help you avoid any payments you are ordered to make. An automatic stay order will be issued so that your wages won’t be garnished.
If you are facing foreclosure on your home or repossession of your car, bankruptcy will not eliminate the creditor’s lien on your property, but it can delay these processes and give you some time to get things in order. Also, Chapter 13 bankruptcy can allow you to restructure your payments or reduce your debts so that you can keep your property.
If you are asking yourself should I file for bankruptcy, and you are facing a lawsuit, foreclosure, or repossession of your property, bankruptcy may be a good way to avoid losing your wages, your home, or your car.
How much property do I own?
How much property you own is a key consideration if you are wondering whether bankruptcy is right for you. First, consider how much property you own and how much it’s worth. The value of your property can help you determine your next move.
With Chapter 7 bankruptcy, your property will be sold off to repay debts unless it meets one of the bankruptcy exemptions. The exemptions vary from state to state, so consult with a bankruptcy lawyer to see which of your assets are exempt. With Chapter 13 bankruptcy, you will have to repay your debts from your income over time, so if you have non-exempt property that you wish to keep, Chapter 13 is probably a better option.
Whether you file Chapter 7 or Chapter 13 depends on the specifics of your case. If you have a lot of valuable property that is not exempt from bankruptcy and you do not a sufficient, steady income, bankruptcy may not be the best option for you altogether. An attorney can help you make the decision of whether bankruptcy is right for you or not.
Facing large debts, calls from collection agencies and creditors, lawsuits, and foreclosures can be extremely stressful. Bankruptcy is one way to help you deal with these situations and get your life back on track. But, bankruptcy is a complicated process and whether it is right for you depends on the specifics of your case, including the amount of your debts, the types of debt you owe, your level of income, and your goals. So when you ask should I file for bankruptcy, the best thing to do is probably get advice from an experienced bankruptcy attorney to determine the best course of action.