How to Know When Bankruptcy Is Right for You

How to Know When Bankruptcy Is Right for You 
Before you decide to file for personal bankruptcy you should be aware that it is not necessarily the best choice for everyone. For many people, bankruptcy should be the last-case scenario only after they have weighed all of their options and determined that they can’t remedy their financial woes.
Ultimately, the decision to file for bankruptcy should be made between you and an experienced bankruptcy attorney. However, there are other methods of determining whether you can get the help you need before consulting with a lawyer and we will outline some of them here.
Are You Eligible for a Debt Management Plan? 
Most people who are financially distressed look to bankruptcy to alleviate them from credit card debt and help them get a new start. Before signing the bankruptcy paperwork, sometimes a debt management plancan help you to reduce your monthly payments, lower interest rates, stop late fees and collection calls and ultimately put you on a path to avoiding bankruptcy.
If you have not already, see if you are eligible for a debt management plan before deciding it’s time to throw in your chips.
Determine if Bankruptcy will Actually Help You
In some cases, bankruptcy will not actually alleviate you of all your debts. Certain types of unavoidable debts, called priority obligations, may not be wiped out in bankruptcy.
You have to consider what you are trying to accomplish by filing for bankruptcy and find out if Chapter 7 or 13 will remedy you of your concerns. As bankruptcy can be complicated, it’s best to consult with an attorney to address what you are hoping to achieve by filing and if there are other options.
Do You Qualify for Bankruptcy? 
Personal bankruptcy, Chapters 7 and 13, have certain eligibility requirements. For instance, if you are going to file for Chapter 7, you’ll have to have a low enough income. For Chapter 13, your debts can’t exceed a certain limit.
Not everyone qualifies for bankruptcy and debtors’ cases can be dismissed if they don’t comply with the courts requirements. For this reason individuals are discouraged from filing without the help of a bankruptcy professional or bankruptcy attorney; there are simply too many laws and policies that can be missed that may result in the dismissal of your case or worse, fraud which results in fines or criminal charges.
Is it Time to File for Bankruptcy? 
If you are looking for the answer of whether or not you should file for bankruptcy, you should start by asking yourself the above questions. If you find that you can’t afford a debt management plan, are unemployed and have no way to pay off any kind of debt, your best bet may be to consult with a bankruptcy attorney.
Ultimately a bankruptcy attorney will be able to help you explore your options and help you get through what is undoubtedly a stressful and challenging time in your life.
Author Byline: is an IRS Approved 501c3 Non-Profit Florida Corporation dedicated to our mission to educate, advise and empower youth to seniors to handle debt, credit and housing and to provide affordable housing opportunities through the acquisition and rehabilitation of residential properties.
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Terrance Leeders

Chicago Bankruptcy Lawyer, husband, father, Cubs fan.

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