Should you seek bankruptcy protection?
If you are reading this blog, chances are that you are in debt and need some guidance. If you are like many of our clients, you are reluctant to talk about your debt or even consider the “B” word - bankruptcy. Don’t be ashamed about needing help.
Before deciding if bankruptcy protection is for you, here are some questions to help weigh your options:
- Is your current income level likely to remain the same?
- Do you bring home enough each month to pay your family’s reasonable and necessary expenses (including rent/mortgage payment, utilities, food, medical expenses and prescriptions, laundry and dry cleaning, child care, car payment, insurance)?
- Do you have any disposable income left after paying your necessary expenses that you can use to pay your credit card bills and other debts?
- Are you able to pay more than the minimum payments? If you cannot afford more than the minimum payments then you may be in an endless cycle of merely paying interest and penalties without reducing your debt.
- Do you have trouble paying your mortgage if you pay your credit card payments?
- Are you able to pay your necessary expenses in part because you rely on credit cards to pay for things like food and clothing?
If the answer to these questions is anything other than "I am able to pay my monthly expenses and pay down my debt each month without needing to use my credit cards", you may need bankruptcy relief.
If you do not have any disposable income after paying your necessary monthly expenses, chapter 7 may be a good option for you. A chapter 7 allows you to discharge regular debts and retain your exempt assets.
If you do have some disposable income left but not enough to pay all of your unsecured loans or credit cards, a chapter 13 may be a good option. A chapter 13 allows you to retain all of your assets and pay your creditors an amount that is determined in part by your disposable income and the non-exempt value, if any, of your assets.
If you are still reluctant to learn your bankruptcy options by speaking to an experienced bankruptcy lawyer, ask yourself, “Why?”
Are you embarrassed? Well, don’t be. It's common! Bankruptcy relief has helped millions of people emerge from their crushing debt. Remember that good bankruptcy lawyers understand, they don’t judge. Their job is to provide you with options and that includes non-bankruptcy options.
Are your remorseful? Do you think that since you incurred the debt you should pay it? If your situation is simply that you cannot keep up with the minimum payments of high interest loans and credit cards to the point your family is going without things such as medical care and necessities, don't let remorse or guilt guide you.
Finally, contrary to many bankruptcy myths, you will survive a bankruptcy discharge, you will not lose all of your assets and you will rebuild your credit. We will guide you on how to rebuild your credit with smart choices.
You have nothing to lose by learning your options. Remember, knowledge is power.