4 Signs You May Want To File For Bankruptcy
Bankruptcy is a situation that doesn't always hit folks suddenly. Although there are certain scenarios where something big, like a massive medical bill, can force bankruptcy forward, many cases build up over years or even decades. If you're not sure whether you require bankruptcy attorney services, here are four signs you might want to think about it.
Debts Continue to Accumulate
Especially if you've taken steps to limit adding more to the debt pile, it's a worrisome sign that the total you owe continues to go up. Simply put, that means there isn't likely to be a light at the end of the tunnel unless you see a massive increase in your income. Instead, you'll just keep adding to what you owe.
Fortunately, this is one of the main reasons bankruptcy attorney services exist. You can petition the court and show that your income is insufficient to ever meaningfully pay down your debts.
Savings Are Close to Zero
This isn't a guaranteed sign that bankruptcy is in your future, but it's also not great. Generally, a person with enough income should be able to pay their debts and add to their savings. Notably, a lot of financial advice tells folks to pay their debts down before saving, and that's fine. You should at least be able to build a rainy day fund, however. If not, then there's a chance you might want to consider bankruptcy.
Income Is Low
Bankruptcy eligibility is fairly well-defined, especially when it comes to Chapter 7 liquidation. That's the process where the court sells non-essential assets, gives the proceeds to creditors, and then cancels whatever is left. Many folks are automatically eligible to file for Chapter 7 if they make less than their state's median income for a household of their size.
Even if you make more than the median income, you may still be eligible. You'll have to submit a form that shows why your financial circumstances justify it, though.
Notices and Warnings Keep Coming
While people often think of mortgages, car loans, and credit card debts as the main reasons to pursue bankruptcy, everyday bills also can drive you there. If you're looking at shut-off notices or threats to repossess a vehicle, it might be time to seek bankruptcy attorney services.
Fortunately, if the court considers your petition, you'll receive an automatic stay. This halts all collection actions until the court has sorted your case out.
Reach out to a local bankruptcy attorney service for more information.