Each person’s finances are going to be different and unique to that person. But when you find yourself with more debt than you can reasonably pay off, it may be time to consider filing for bankruptcy. However, there are nuances to consider so that you can make sure filing will be in the best interest of your financial future. While there are certainly benefits to filing for bankruptcy, there are drawbacks too. For example, while you may have debts discharged, not all of them may be eliminated, and you are likely to have a bankruptcy status sit on your credit report for a decade.
All in all, if the information provided below is true for your circumstances, then you may be someone who can greatly benefit from filing for bankruptcy:
Your Budget Hasn’t Been Working
Are you constantly having to use credit cards or borrow money to meet your financial obligations? If so, then your current budget is probably too tight, and your earnings are not enough to allow you to afford life necessities and payments for debts. If you are unable to make the minimum payments for credit cards or other life expenses, then it may be time to consider what bankruptcy can offer.
You are The Victim of a Scam
If you feel the weight of debt on your shoulders every day, then you may be vulnerable to becoming the victim of a scam. Scammers know how to get information about people so they can use this to take advantage of them, particularly those who are struggling financially. If you were targeted and suffered a scam, which may have resulted in even more financial distress, then bankruptcy may be a realistic option.
Your Interest Rates are Too High
There may come a time when you need to apply for a loan, but this can be difficult if you already have plenty of debt to deal with. If your loan application is approved, then you may receive a fairly high interest rate. You may end up paying more for the money borrowed than if you had good credit and less debt. If borrowing money has become an impossible option, either due to being too expensive or you’ve been consistently denied, bankruptcy may give you the restart you need.
Your Mental Health Has Suffered
Financial hardships have a way of permeating our minds and can make us feel worn down. But it’s important to remember that there are resources for those who need some help lightening their debt load. Mental health and our finances can feel intrinsically linked, so if your debts continue to wear down your mood, then bankruptcy could prove to be the outlet you need to have a fresh start.
Bankruptcy can be a useful resource, but as a bankruptcy lawyer from Carolyn Secor, P.A. would suggest, weigh the pros and cons to make sure there are more benefits than disadvantages and that you file for the correct bankruptcy chapter.