In 2018 there were more than three-quarters of a million personal bankruptcy filings in the US.
When debts spiral out of control, bankruptcy can sometimes be the best way to free from debt and turn things around.
There are downsides to filing for bankruptcy, but for many people, the benefits outweigh the costs.
Should I declare bankruptcy? Read on as we look at five signs it might be worth considering.
1. Your Bills Are Out of Control
If every month is a constant battle to pay your bills, this is a sign that you may need to consider bankruptcy.
If you’re regularly missing payments or borrowing money every month just to pay off all of your bills, this isn’t a sustainable position. If you can’t find a way to reduce your debts or make more money, you’ll never be able to escape the cycle without options such as bankruptcy.
2. You’re Relying on Credit Cards
If you’re accessing more debt to pay off your debts, you know things are getting out of hand.
If you’re using your credit card to cover payments you couldn’t afford, you’re just replacing one debt with another. This might work in the short term, but you’ll just be racking up even more interest that you can’t afford to pay off.
When maxing out all your cards, it’s time to consider bankruptcy as an option.
3. You’re Behind on Major Payments
If you’re behind on small payments, then it’s so much of an issue. However, if you fall behind on major payments, this can have serious consequences.
For example, if you’re falling behind on mortgage payments, there is a severe risk of losing your house. Likewise, you could lose everything you’ve invested if you’re struggling to meet expenses for your business.
In this case, you need to speak to business bankruptcy law firms who can advise you on the best way forward.
4. Debts Are Causing You Stress
Your health is more important than money.
If your debts are causing you severe stress, then it can harm your health. Filing for bankruptcy can help free you from your debts and remove the stress they have caused.
If money issues are affecting your health, you can always take steps.
5. You’ve Run out of Savings
It’s essential to have savings in case of an emergency if you’re burned through all your savings paying off your bills.
You will become into debt if you struggle to pay bills and other obligations. If your savings have been used up, it could be time to consider taking action.
Should I Declare Bankruptcy?
It’s a question many people ask: should I declare bankruptcy? If any of the signs listed above are things that you’re experiencing, then the likelihood is that bankruptcy is something you should at least consider. Speak to a professional who can advise on whether bankruptcy is the right option and what the next steps should be.
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