January 3, 2014 - 03:01 by rmckinney
It’s a new year and a new you! But what if your new year is already feeling weighed down by the debt that was plaguing you last year? Filing bankruptcy may be able to help you truly start this year off with a financial fresh start. If you are wondering whether filing a Chapter 7 or Chapter 13 bankruptcy is right for your specific situation here are some things to consider:
1. What debts are causing your main struggle?
Deciding to file bankruptcy can start by figuring out which debts are really causing you the most trouble. Chapter 7 bankruptcy is best for individuals whose main debt struggle is caused by credit cards, medical bills, payday loans, or other unsecured items. On the other hand Chapter 13 bankruptcy can help with secured debts like a home in foreclosure or a vehicle that is on the verge of being repossessed. If your debts do not fall in either of those categories then you may be dealing with debts that bankruptcy cannot really help with like: back taxes, parking tickets, student loans, child support or alimony.
2. Do you make enough to pay your monthly bills?
Income has a lot to do with which type of personal bankruptcy is right for you. Start by asking yourself how much money you have left over at the end of the month once you have paid necessary bills like rent, utilities, groceries, etc. If the figure you end up with is a negative number or very close to $0 then you will most likely qualify for a Chapter 7 bankruptcy. If the figure you end up with is $500 or more then the bankruptcy court may conclude that you have enough to pay back some of your debts in a Chapter 13 bankruptcy repayment plan.
3. Are creditors contacting and/or garnishing you?
Some good indicators that you may need to consider the option of filing bankruptcy is when creditors begin calling you non stop, writing threatening letters, or take you to court in order to obtain a garnishment order from the judge. If anything like this is happening to you then take comfort; filing bankruptcy can stop the debt collection process in it’s tracks! That’s right, just by filing a Chapter 7 or Chapter 13 bankruptcy the court provides a protection that keeps creditors from pursuing any type of debt collection against you. Even garnishments that are already in motion are brought to a screeching halt when the debtor files bankruptcy.
If you have been asking yourself these questions for months and are dealing with debt that you just don’t think you can overcome alone then it may be time to consider going bankrupt. Don’t let another year go by without picking up the phone and asking a bankruptcy attorney for help. Let bankruptcy help you start this new year off right by becoming debt free!