Adam Law Group Blog

When is it Okay to File for Bankruptcy?

One of the most common problems faced by people who are overwhelmed with debt is determining when it is okay to file for bankruptcy. Even if people are struggling with their bills, it can be difficult to decide that bankruptcy is the best option. The following will review several of the questions that you should ask yourself to determine whether you are ready to file for bankruptcy. If you do decide that bankruptcy is a good option for you, should not hesitate to obtain the assistance of an experienced bankruptcy lawyer.

Your Situation Will Not Change Any Time Soon

Even if you are at the end of your financial rope, you might be ready to take a new job or about to receive money as part of an inheritance. If your financial difficulties are about to end, it is often a better idea to wait it out than file for bankruptcy. By all means, you should avoid using the much more permanent solution of bankruptcy to solve a temporary money problem, which will end when your situation improves and you have more money to pay down your debts.

You Appreciate the Disadvantages of Bankruptcy

Before finalizing the bankruptcy process, you are required to receive an educational class about bankruptcy and what happens after you enter the bankruptcy process. Participating in this class or speaking with a knowledgeable attorney will teach you about the various types of property that you will likely have to surrender if you declare bankruptcy. During this time, you should also assess whether you are comfortable navigating the bankruptcy process.

The Majority of Your Debts are Unsecured

Bankruptcy is not capable of discharging all types of debt. Instead, bankruptcy discharges unsecured debt including credit card balances and medical bills. Secured loans, however, like student loans and outstanding child support are rarely capable of being discharged in bankruptcy. If you primarily have secured debt, bankruptcy will not affect your commitment to pay these outstanding amounts. It is important to understand what type of debt you before entering bankruptcy.

Bankruptcy Will Let You Rebuild Your Credit

Bankruptcy offers the opportunity to rebuild your credit. While some people take advantage of this second chance and rebuild their credit record, other individuals do not and continue repeating the mistakes the led to bankruptcy in the first place. If you think that you will able to learn from your past and rebuild your credit, bankruptcy is likely a good option. If you think that you are likely to make the same mistakes again, it might be a good idea to wait before filing for bankruptcy.

Speak with an Experienced Bankruptcy Attorney Today

If you are interested in filing for bankruptcy, it is common to feel uncertain about how to proceed through the process. Fortunately, a knowledgeable bankruptcy lawyer at Adam Law Group understands the many complicated issues involved with bankruptcy law and can help guide through this process. Contact our law office today to schedule an initial free consultation.