Financial strain and excessive debt are a leading factor of stress and can become a debilitating obstacle. Sometimes financial health is severed by excessive spending and ill-formed decision making. Other times, life-changing events like an expensive divorce, court-ordered alimony payments, or lengthy medical treatments can leave your bank account completely drained. Regardless of how the debt was accumulated, a financial burden can feel insurmountable.
Although some people might feel like there is a negative stigma attached to the term “bankruptcy,” unavoidable life events happen. When they do, bankruptcy can actually be a positive, life-changing option. Financial difficulty is not limited to people who are living paycheck to paycheck. It can happen to anyone.
When Does Filing Bankruptcy Make Sense?
If you are behind and unable to pay your debts, bankruptcy may offer a fresh start. Of course, this decision should not be taken lightly. The best question you can ask yourself is this – are you making more money each month than you owe? If the answer to this questions is “no,” that is a strong indicator that your finances are in peril.
Here are some additional points to consider when determining if bankruptcy is the right decision:
- Are you receiving letters and calls from creditors encouraging you to pay off your overdue debts?
- Have you started to see wages garnished from your paycheck?
- Are you able to pay off more than the minimum amount due on your credit card each month?
- Have you gone into default on your student loans?
- Can you afford your monthly child support and alimony payments?
If you believe that discharging your debts through bankruptcy is the right decision, the next step is understanding how to file.
Understanding How to File for Bankruptcy
There are two ways that you can declare bankruptcy. The first way is involuntary, this means that the creditors who you owe money to are asking for you to show up in court to declare bankruptcy. This phase can occur before or after your wages are garnished. The second way is to file voluntarily. This means that you are acknowledging that your debt is unmanageable and you are seeking the court’s permissions to absolve and discard that debt. If you proactively declare bankruptcy you will most likely have more control over the timing of the situation, and this can be beneficial. Either way, it is advisable to work with a lawyer through this process. You want to make sure you are filing correctly, and that you are setting yourself up for success in the future.
Contact a Salt Lake City Bankruptcy Lawyer Today
Before you begin the process of filing for bankruptcy, it is essential to understand what type of bankruptcy option suits your specific scenario. There are true distinctions between Chapter 7, 11, and 13 bankruptcy claims. Recognizing the right option for you will ensure that you are set up for future financial success. The last thing you want is to file for a repeated bankruptcy. The experienced attorneys at JLT Law will help you determine which course is correct for you. Contact us today at (801) 896-9444 or online to schedule an initial consultation.