Trying to manage debts on a month-to-month basis can be tough. Sometimes it is so tough that you might need to look for other options for dealing with your debts. People who have a lot of debt often consider filing for bankruptcy as a way to get out from under their mountain of debt. But how is someone supposed to know whether filing for bankruptcy is a good choice for them? If you can tell that your financial situation is unlikely to change without you taking some sort of drastic action, like filing for bankruptcy, then you should start asking yourself questions that can help you decide whether bankruptcy would be a good idea in your particular situation.
Questions You Should Ask Yourself About Bankruptcy
Do you have any other options besides filing for bankruptcy?
If you do not have any cash reserves or assets that you can liquidate that you can use to pay down your debt, then bankruptcy might be a good choice for you. Many people consider credit counseling as an option they explore before seriously considering bankruptcy filings. If you have tried credit counseling, but your debt situation is unbearable, schedule some time to talk with a licensed insolvency trustee.
Do you qualify for bankruptcy?
There are certain eligibility requirements that must be satisfied in order to qualify for bankruptcy as a debt relief measure. In order for you to qualify to file for personal bankruptcy, you must owe at least $1,000 and be either unable to meet required payments as they fall due, or own insufficient assets to repay your debts.
Would you be able to walk away from your debts?
Some people feel a sense of pride or accomplishment when they pay their debts, and some people feel like it makes them a failure if they discharge their debts through bankruptcy. You have to take a good hard look at how you feel about the idea of discharging your debts through bankruptcy. If you feel like you would not have a problem letting your debts go, and that it would not make you feel negatively about yourself, then bankruptcy might be a good choice for you.
Do you understand the consequences bankruptcy has on your credit?
It is important that you understand that bankruptcy will have an impact on your credit worthiness, and that it can take many years to restore your credit score. It is not an impossible feat to rebuild your credit, but it does take time, dedication and effort on your part.
If you’ve asked yourself these questions and believe bankruptcy is the right option for you, contact our office today for a free, no-obligation consultation. We’re here to help!
