Making the decision to file for bankruptcy can be extremely challenging, but there are certain scenarios where you should consider it as an option. Speaking to a bankruptcy professional can help you make this decision, and you can also consider these 5 scenarios.
1. You or your spouse have lost your job, meaning there’s no money to pay your debt.
Losing your job is scary for anyone to go through, but when you have massive debts to pay, it can be downright terrifying. Fortunately, bankruptcy is an option that may help. Filing for bankruptcy will allow you a certain amount of debt relief, and the opportunity to start anew. It can take the pressure off when the credit card companies won’t stop calling.
2. You are overwhelmed by your debt and it’s affecting your mental and physical wellbeing.
Carrying huge amounts of debt can be mentally and physically draining. From keeping track of payments, to calculating your interest, to lying awake wondering if you’ll ever pay it off, debt certainly has a toll on your health. If debt is starting to affect your sleep, your ability to function, or your mental health, it may be time to talk to a bankruptcy professional to see if bankruptcy is a good option for you.
3. You can’t get by without using credit cards.
If you’re credit-reliant, it may be worthwhile to consider filing for bankruptcy. Being credit-reliant means you can’t pay for everyday essentials, such as gas, groceries, and rent without using credit cards. Because credit cards often have massive interest rates, being credit-reliant can quickly add up. If this is the situation you find yourself in, it’s worth talking to a bankruptcy professional to see if you might benefit from filing for bankruptcy.
4. You have reached your borrowing limit.
If the bank won’t lend you any more money, you may be in a situation that calls for bankruptcy. Reaching this point can take years, but it’s a place nobody wants to be. If you’re completely unable to continue borrowing money, it means you should consider filing for bankruptcy. Bankruptcy professionals can help you evaluate the situation and consider whether it’s right for you.
5. You can’t bring your debt down no matter what you do.
Even if you’re able to make payments, but your debt continues to rise, you may want to consider filing for bankruptcy. If you’re feeling like all your money is going into your debt, but it isn’t making any difference, filing for bankruptcy may be the best solution. A bankruptcy professional can help you understand your options when you’re in this situation.
6. You’ve considered other debt relief options.
Bankruptcy is traditionally considered an extreme way to deal with extreme debt. However, there are other options available to you. A bankruptcy service provider can help you look at your options and determine the best option for you. For example, sometimes you’ll qualify for debt relief or debt consolidation. However, these options may not work for some situations. It’s worth considering all your options before filing for bankruptcy.
