Why should you consider bankruptcy?
You and your family are priority number 1! If you cannot realistically take care of yourself and your family, then the same rationale applies to your creditors. Eventually, you will not be able to take care of them.
Your credit will be better! This is a tough pill to swallow, but the reality is that when you eliminate your debt, you actually are improving your credit score. Generally speaking, 1/3 of your credit score with all three bureaus is based upon the debt-to-credit ratio. Bad credit always improves with bankruptcy. Only good credit drops, but usually not as much as you would think and only temporarily. In most cases, it’s not uncommon to be in the 600 to 700 credit range within 1 to 2 years of completing bankruptcy, provided you get at least 4 main lines of credit and maintain your payments.
When should you talk to an attorney about bankruptcy?
1. Your wages are being garnished. Wage garnishments take a big chunk out of your paycheck, often leaving you unable to make rent/mortgage payments, car payments, pay for medicine, or even put food on your table. A bankruptcy filing will stop garnishments immediately, and may let you get back some of the money that’s already been sent to the creditor.
2. If you’ve fallen behind on car or mortgage payments and need more time than the lender will give you to catch things up, a Chapter 13 is the perfect option. It gives you up to 5 years to bring things current (even if the lender won’t give you the time now).
3. The IRS is going after you. Bankruptcy lets you discharge, or wipe out, some taxes, and a Chapter 13 lets you set up a 5-year payment plan on those that aren’t.
4. You’re in over your head and don’t see a way out. If you’ve been hit with a universal default on your credit cards and are paying 29%+ APR, your house or car is worth a lot less than you owe on it, you owe a lot of debt and don’t see ever being able to pay for it…well, bankruptcy offers you the opportunity for a fresh start. Most of my clients tell me that they should have filed at least a year before they called me for the first time, and they lost a lot of money trying to fix the unfixable. If this is your situation, a Chapter 7 or 13 can help you climb out from under the debt mountain.
How do you know that you are doing the right thing?
I honor the impulse in clients that says “I want to pay my debts” but I applaud more loudly the client who accepts that it isn’t possible, and takes the necessary action. If you are facing any of the events I’ve listed above, call Smith & Weer, P.C. for a free, no obligation consultation. One of our attorneys will discuss ALL your options — not just bankruptcy — that are available to re-organize your debt. Do not procrastinate. Being burdened by debt is stressful, it can affect your health and your relationships. Be Informed. Discover there are Solutions to Your Debt Problems. Call us today.
» Click here to find answers to additional bankruptcy questions.
» Click here to read why bankruptcy should not be a last resort.
