Knowing When Bankruptcy Is Right

May 16, 2012 by  Filed under: Bankruptcy 

Filing for bankruptcy can be one of the best financial moves of your life, but it isn’t for everyone. There are many things that go into filing for bankruptcy, which means it isn’t a decision to be made quickly. In order to gain the most benefit from the process, it is important to review certain aspects of your financial life carefully before filing the petition.

Your Debts Are Overwhelming

Many people consider bankruptcy simply based on the fact that they are overwhelmed by their debts. While tight finances and the occasional missed payment are points of concern, it doesn’t necessarily indicate you are a good candidate for bankruptcy. Debt burdens appropriate for bankruptcy are those that cause additional financial hardship, can only be repaid by borrowing from another source or are consistently missed for many months. Further, the types of debts carried are important when considering bankruptcy. If the majority of your debts are student loans, taxes or unpaid domestic support payments, you are not likely to find relief in bankruptcy as these debts rarely qualify.

Your Assets May Be At Risk

Debt troubles can lead to all kinds of consequences, some worse than others. When you default on a secured debt, like a mortgage or car loan, those assets immediately become at risk of liquidation. Filing for bankruptcy can prevent a foreclosure or repossession, a benefit that many people find desirable about the bankruptcy process. Compared to traditional debt negotiation, bankruptcy places an immediate legal hold on any lawsuits, seizure or garnishment orders. This allows you to resolve your debts without worrying about losing your assets to creditors.

You Have Reviewed All Your Options

Although bankruptcy is a great tool of financial assistance during a financial hardship, it should never be the first choice you consider. The process is more time consuming and involves more attention from legal avenues. Traditional debt negotiation can be one of the best places to start when considering debt relief options. Contact your creditor to discuss your options for lowering your payments or repaying your debts. You may be surprised to learn that many creditors are willing to negotiate rather than risk losing their money if you were to file for bankruptcy. It is also important to consult a bankruptcy attorney before filing your case. They can ensure you have considered all your options and that bankruptcy is a good fit for you. An experienced attorney can also ensure your debts get negotiated fairly and protect as many of your assets as possible.

The Lee Law Firm aims to help local residents resolve their debt issues and achieve a financially healthy future. Their mission is to provide high quality legal representation that to assist hard working people lower monthly debt payments, stop wage garnishment, prevent foreclosures, and stop calls from creditors. The Lee Law Firm bankruptcy attorneys have many years of experience in all aspects of Chapter 7 and Chapter 13 Bankruptcy in Dallas.

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