Making the decision to file bankruptcy is never easy. In many cases, bankruptcy is the best option for individuals and families experiencing extreme financial difficulty. Here are the five most common reasons for filing bankruptcy and how to get sound advice when you’re overwhelmed with bills and financial challenges.
1. Job Loss
Unemployment can come when you least expect it and can have a significant impact on your family’s financial status. If you don’t have an emergency savings or can’t find another job, you put your rent or groceries on a credit card.
2. Stopping the Foreclosure of Your House
If you are threatened with foreclosure yet cannot get back on track with payments, consider bankruptcy to stop the foreclosure and keep your home.
3. Stopping the Repossession of a Car
Just like a bankruptcy will stop a home foreclosure, it will also stop the repossession of a car. You can file for bankruptcy and keep your car if you file for a Chapter 13 bankruptcy. Then, any missed payments are added to your bankruptcy plan.
4. Illness or Accident
Often times, people who suddenly become ill or injured in an accident face unexpected medical bills. These bills can spiral into a financial crisis. Whether medical bills burn through a small savings quickly or no savings existed, a serious illness or injury can cost hundreds of thousands of dollars. In some cases, a family may file a Chapter 7 bankruptcy to have the medical bills reduced or even discharged entirely.
5. Stop Creditor Harassment
Creditors are ruthless when collecting on a debt. So, if you owe multiple debts, you’re likely getting accosted every time you turn around. When a bankruptcy is filed, an automatic stay goes into effect and creditors must halt all collection activities. This gives families inundated with bills a reprieve from the constant calls and letters.
Carefully evaluate whether bankruptcy is the right choice for you. At the Law Office of Howard Tagg, we’ll go over your case in detail with you to help you come to a decision about filing bankruptcy and if so, what type would be most beneficial to your situation. If you’re experiencing financial stress, don’t hesitate to call us for a consultation at (903) 730-6366.