Struggling with debt can sometimes feel overwhelming and never-ending. Fortunately, there are ways to move yourself and your finances beyond your current struggles. Filing for bankruptcy may provide benefits that far outweigh the woes that come with constantly battling debt. Before taking this route, however, it is important to know whether your financial situation warrants such a decision.
If you are struggling with the question of whether you should file for bankruptcy, keep reading to learn more about the warning signs. Below, we outline a number of warning signs that are often caused by difficult financial situations. Identifying one or a combination of these indicators may help you determine when to file bankruptcy. If any of these scenarios describe your situation, then we encourage you to speak with a Kansas City bankruptcy lawyer from our firm.
Collection Agencies Are Contacting You
Typically, this happens when you have failed to pay off a debt for an extended period of time. When this occurs, debt collectors will begin to make frequent calls, asking you for payment. However, simply owing money to a collection agency does not automatically mean you should file for bankruptcy. If you can pay off your debts, you should try to resolve this issue on your own.
Bankruptcy becomes a reasonable option when your financial situation is dire. This could mean owing money to multiple collection agencies or simply not being able to make payments. Failing to speak with the agency, or to make payments, may result in a lawsuit. The result could mean wage garnishments, repossessions, and foreclosures.
If you find yourself avoiding the phone out of fear that it is a debt collector calling, then you should reevaluate your financial situation. Ignoring the issue will not make it go away. It could actually make your situation worse.
You Are Unable to Make Minimum Payments or Are Always Paying Late
Taking on a lot of debt, or multiple kinds of debt, is sometimes unmanageable. Often, people will find themselves living from paycheck to paycheck because so much of their income goes to making payments. Many see their paychecks disappear before their next payday. When this happens, it is not uncommon to turn to credit cards for basic purchases, like groceries or gas. Unfortunately, this means that a cycle of debt is underway and it becomes unclear how one can get out.
Others will use their monthly income to take care of basic living expenses. However, this means that payments are likely being neglected. Missing payments or only making partial payments will result in fees, which could worsen the financial situation. Again, the cycle of debt is underway, seemingly with no light at the end of the tunnel.
If you find yourself in either of these scenarios, you should consider filing for bankruptcy.
Your Home Is Being Foreclosed, You Are Being Evicted, or Your Possessions Are Being Repossessed
Facing a home foreclosure or repossession are the biggest warning signs that you may need to file for bankruptcy. Delayed payments have now turned into the threat of losing valuable assets. Facing one or both of these situations is already scary and stressful. On top of this, losing your home or your means of transportation also brings on a slew of compounding issues.
For example, if your vehicle is repossessed, you may have difficulty getting to work. When you are already facing insurmountable debt, the last thing you want is difficulty getting to your job, which is your source of income.
In these situations, filing for bankruptcy may protect you from losing your home or possessions. If you find yourself in one of these scenarios, it is time to speak with a Kansas City bankruptcy lawyer to discuss your options.
For More Information, Contact a Kansas City Bankruptcy Lawyer at the Sader Law Firm
Determining when to file bankruptcy depends on a lot of contingent factors. No two people will face the same combinations of debt and financial circumstances. However, many find that filing for bankruptcy is the best possible solution for them. It is important to understand that filing for bankruptcy is not uncommon, nor should it be scary.