Declaring bankruptcy may be a difficult prospect to consider, as this is a legal process that affects your credit rating and personal finances for many years to come. However, it also means relief from debt and protection from your creditors. While only an attorney can advise you on your personal situation, note a few things to consider when deciding if it's time to declare personal bankruptcy.
Are you planning any major financial obligations in the next few years?
You may already own a home and own a car that you know will last for quite some time. In that case, you may not be looking to take on any major financial obligations in the next few years. Having a bankruptcy on your record may not readily affect you in this case. However, for those who are thinking of buying a home or may need to shop for a new apartment, get a car loan, get a student loan, or who may be thinking of other such financial obligations, a bankruptcy can hurt your chances of approval.
That being said, it's good to still discuss this with your attorney and note how long the bankruptcy would stay on your record. They might tell you how you can repair your credit after declaring bankruptcy or how long it would take before you might be eligible for these types of loans again. You might be prepared for the work to rebuild your credit or can wait and put off that car loan until your credit is restored.
Is your debt interfering with your ability to manage your everyday finances?
Having a bit of debt that you pay every month may not mean that you're ready for bankruptcy, even if you'd prefer to not pay that debt! However, if the amount you need to pay interferes with your budget for groceries, rent, transportation, and other such necessities, it may be time to consider bankruptcy. This can allow you to use your salary to provide for yourself and your family and have money available for emergencies or savings.
Are you close to losing your house or car other such property?
Never dismiss threats of creditors when they say they might repossess your car, foreclose on your home, or seize money you have in the bank. In some cases, they can very well do this and the damage done to your credit can mean that it's difficult for you to find a new car or apartment afterwards. Rather than suffer this type of damage to your everyday life, discuss your options with a bankruptcy attorney for restructuring your debt or to decide if bankruptcy is the better option overall.
For more information about insolvency and bankruptcy, contact an attorney or financial planner.
Share29 August 2016
I love all of those quirky laws that are still on the law book. It's a little hobby of mine to track down some of those laws and try and work out if there was a story behind how they got on the books. I've been doing it for 14 years and have accumulated a lot of material that I have researched. I thought it would be fun to start a blog with some of these stories to share with other people who like to know a little more about law and about history. I hope you enjoy my site.