The stress of overdue credit card bills and other unpaid debts can add up over time. In some cases, people want to end the stress and pressure they face when they’re getting low on funds and keep receiving calls from collection agencies. According to recent data, more than 12 million people filed for bankruptcy from 2005-2017. For many, filing for Chapter 7 or Chapter 13 bankruptcy isn’t always ideal, but it can give people a chance to start over and reorganize their financial livelihood.
Signs it may be to file for bankruptcy
Consumers may want to consider if they are in any of the following situations:
- Their wages are getting garnished: If someone gets sued by a debt collector and loses, the collection agency still has to find a way to obtain the debt they’re owed. In some cases, bill collectors may freeze a debtor’s bank account or take money directly out of their paycheck to ensure they’re getting those payments.
- They’re in danger of losing their home: Despite a recent decline in home foreclosures, if consumers are struggling to keep up on their mortgage payments, bankruptcy could help them keep a roof over their head. If consumers are planning to file for Chapter 13 bankruptcy, they can still keep their assets and create a plan to reduce their payments. As long as they keep making regular payments on their mortgage, they can lower their risk of losing their home.
- They’re struggling to pay their bills: People can struggle with bill payments for many reasons. Whether they lost their job or caught an unexpected illness, many circumstances could lead someone to financial hardship. Even if they can cover necessary living expenses, keeping up with them can be a challenge, especially if they have other debts they have to pay off.
Everyone deserves a fresh start
Sometimes, life can throw unexpected financial curveballs. While it can be challenging to handle, consumers can find light at the end of the debt tunnel. For those considering filing for bankruptcy, they should evaluate their options and figure out which one works best for their situation.