As a bankruptcy attorney, I know that individuals and couples go through several stages when they are answering the question “Should I file bankruptcy?” While most consumers follow a similar process when tackling this question, not every person will follow the same exact path to decide whether or not bankruptcy is right for them. This is because each person’s or couple’s financial situation is unique; however, through years of experience and by helping thousands of clients through the bankruptcy process, my partner and I have learned that most debtors go through at least three stages before deciding if they should file bankruptcy. While not all three steps are necessary, and many may skip to the last and most important step, there is some value in each of the following steps.
Common Steps Taken to Answer the Question, “Should I File Bankruptcy?”
Step 1: Research bankruptcy and bankruptcy alternatives.
For most people, bankruptcy is a term they have never really thought about until they find themselves in a situation where they cannot pay their bills. Even most attorneys who do not practice within the bankruptcy system avoid dealing with bankruptcies, preferring to leave that area of law to attorneys who specialize in bankruptcy. However, because of the advanced level of access we have to information via the internet, books, television and other media, most people who are facing financial problems will begin by researching bankruptcy. The internet provides a wealth of information, some accurate and some inaccurate, about bankruptcy in general, the various chapters of bankruptcy and bankruptcy alternatives. You can find answers to questions such as “Will I lose my home if I file bankruptcy?” and “How does bankruptcy affect my credit score?”
As you research and begin to learn more about bankruptcy, the bankruptcy process and alternatives that might be available to you, remember that the information you are reading is only as good as the source. While we appreciate the desire to learn more about bankruptcy before meeting with a bankruptcy attorney, we encourage clients to follow-through to Step 3. Make sure you get the advice of an experienced bankruptcy lawyer who will be working in your best interest, to protect you and your assets from creditors.
Step 2: Analyze your financial past, present and future.
When determining if bankruptcy is right for you, you also need to take a thorough and honest look at your finances, including how you arrived at this point, your current financial situation and what the future holds for you if you ignore your financial problems. Begin by looking to your financial past to determine how long you have been in debt. If you have been in debt for several years while only paying the minimum monthly payments on your debts, it is unlikely that you will ever be able to become debt-free without bankruptcy assistance.
If you presently do not have the money to pay for your living expenses (i.e. food, shelter, clothing, etc.) and to pay your debts, you will begin to fall behind with your debt payments because there is simply not enough money to pay everything. As time progresses, creditors will enlist the assistance of bill collectors who will harass you and your family with threatening letters and telephone calls to collect past due debts. Some may even turn to the legal system to file lawsuits to collect unpaid credit card bills and medical bills. Mortgage lenders will pursue foreclosure and you may see your car repossessed in the future. Before your present situation leads to a darker future, move to Step 3 to find relief from your financial problems.
Step 3: Consult an experienced bankruptcy attorney.
We recommend Step 3 to every person who is struggling financially and who is moving slowly through Steps 1 and 2 trying to decide, “Is bankruptcy right for me?” Meeting with an experienced bankruptcy lawyer has several benefits.
The first is that it is a free consultation -- it does not cost you anything to meet with an attorney to get answers to your bankruptcy questions. Second, you can rely on the answers that you will receive from an experienced bankruptcy attorney much more than those found through unreliable online resources. Third, a bankruptcy attorney will use the free consultation to analyze your unique and specific financial situation to offer real solutions to your financial problems. Each bankruptcy case is different, and only by consulting a bankruptcy attorney will you know which bankruptcy options are available to you and which options are in your best interest.
Our law firm is proud to offer free consultations with an experienced bankruptcy attorney. We will answer all of your questions and provide you with expert advice that can help resolve your financial problems. It is our goal to help each person answer the question “Is bankruptcy right for me?” before they leave our office. We know how stressful money problems can be, so we take time to understand your situation, offer advice that will give you relief from your debts, protect your assets and give you the fresh start that you need.