Three Reasons Why You Should Consider Filing For Bankruptcy
Filing for bankruptcy is something that we’re told to consider only as a last resort, and with good reason. There are significant consequences after you file for bankruptcy or have your debt otherwise negotiated. Most significantly, filing for bankruptcy can have a major impact on your credit score, which in turn can affect your ability to take out loans or even qualify to be a renter. With that being said, in some cases, it is impossible to avoid filing for bankruptcy. From October 1, 2005 to September 30, 2017, 12.8 million consumer bankruptcy petitions were filed in the federal courts. Filing for bankruptcy, whether you are filing for chapter 7 bankruptcy or chapter 13 bankruptcy, requires a good deal of preparation. You need to get in touch with debt negotiation attorneys in order to ultimately decide on whether or not filing for bankruptcy is really right for you. Furthermore, an attorney can better help you determine which type of bankruptcy is best equipped to aid you. With that being said, let’s explore the signs or circumstances that may induce you to consider filing for bankruptcy.
1. You’re Considering Withdrawing From Your Retirement
If you’re drawing funds from your retirement fund early in order to make end’s meet, it may be time to consider instead filing for bankruptcy. Drawing from your retirement once does not necessarily mean that you definitely need to get in touch with debt negotiation attorneys. Every situation is different. There are a lot of risks that come with drawing from your retirement fund early. The fact is that when you take from your retirement early, you are essentially stealing from yourself. Those funds are meant for your future, and you need to think about how much you may need them when you’re retiring, especially if you’re struggling so much right now. In reality, your retirement fund is not meant for debts, but rather maintaining your lifestyle and paying your regular bills after you retire. If you need it that badly now, bankruptcy may be a potential option for you.
2. Debts Keep Increasing
Unfortunately, some of the circumstances that induce us to file for bankruptcy are under our control, while some result from unexpected occurrences. If you’re already deeply in debt due to your student loans, for example, but you also find yourself dealing with further debt due to medical bills, bankruptcy may be the only realistic option on the table. Again, this is something for you to discuss with debt negotiation attorneys, as there may be different ways for you to handle your debts. Consider refinancing loans that you can refinance, but if that’s not at all an option and it feels like you’re only falling deeper and deeper into debt, to the point that you can’t afford your bills, you should think about filing for bankruptcy and the relief that it could offer you.
3. If You’re Underwater On Your Mortgage
If you find yourself completely underwater on your mortgage and on the verge of losing your house, you need to get in touch with debt negotiation attorneys and see if you could potentially file for bankruptcy. The benefits of certain types of bankruptcy filings in terms of managing your mortgage include the fact that it will let you catch up on mortgage payments, negotiate a loan modification potentially, eliminate a second mortgage you’d taken out, free up money that you were spending on other debts that could be better used to pay for your home, and simply streamline the process of catching up on your mortgage payments. Again, everyone’s bankruptcy filing varies. As any good debt negotiation attorneys will tell you, it’s not as simple as waving a magic wand and making your debt disappear. But in this case, it can potentially help you.
Picking up the phone to call bankruptcy attorneys is incredibly difficult, and you will most likely be doing so as a last resort. But if you have no choice, you shouldn’t feel ashamed. Sometimes, bankruptcy is the only option available, and it doesn’t have to be the end; it could potentially be a new beginning for you.