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To File Or Not To File For Bankruptcy: That Is The Question

On Behalf of | Sep 7, 2018 | Bankruptcy

Are you currently trying to keep your head above water because of financial problems? Regardless of what exact issues derailed your money train, you are definitely not alone in your struggle. Many Ohio residents are facing or have recently overcome similar problems. Some merely had to make a few minor adjustments in their spending habits while others determined a need for a more long-term debt-relief solution.

Like them, you might consider filing for bankruptcy to help you get life back on track. If the mention of that word causes you to cringe because of negative stigma often associated with the idea, then learning more about the benefits and downsides of bankruptcy may help you make an informed decision.

How soon can you pay off debt?

Most people choose alternative options for debt relief over bankruptcy if their total debt balance is within a reasonable amount that they can foresee a way to pay back in less than two years. However, if you do not currently have a reliable income, or you do but things have gotten so out of hand that you have no way to pay off your debt, you may want to consider bankruptcy as a viable option to wipe the slate clean and start again.

Which of your debts are dischargeable?

When considering bankruptcy as a debt relief option, you’ll first want to determine how much of your debt is dischargeable. If, for instance, you are behind in child support payments or the court has ordered you to pay compensation for damages in a personal injury claim, such debts would remain, even if you file for bankruptcy.

How much do you owe?

If your total debt is currently less than a couple thousand dollars, there may be ways to resolve your financial problems without filing for bankruptcy. That’s not to say, however, that you should completely discount the option if you determine that, even though you owe less than $2,000, you have no way to pay it and creditors are breathing down your neck.

Is your home at risk?

If a lender is threatening to take ownership of your home because you have been unable to meet your mortgage payments, it is understandable that you feel anxious and want to find a swift and solid debt relief solution that could help you save your home. It is true that many people in Ohio and elsewhere have successfully avoided foreclosure through bankruptcy.

Discussing your situation with someone well-versed in bankruptcy laws is a good, logical first step to take if you’ve been hit with a major financial crisis. It is easier than many people realize to go from a relatively stable financial environment to being unable to make ends meet in just a few months’ time. A medical crisis, job loss or unforeseen expenses can be the straw that breaks the camel’s back.

Be proactive and research practical options

While it is easy to throw in the towel and feel despair when financial problems gain the upper hand in life, with strong support and thorough planning, you may be able to put your money trouble behind you and move toward restored financial stability in the future.