Many people who phone or come into my office want to know when bankruptcy is a good idea for them. While bankruptcy can be the solution to significant financial burdens it should be used in the right way and at the right time in order to maximize its possible benefits. Perhaps you’ve found yourself asking similar questions. Under what circumstances should you speed up the process to file for bankruptcy and when should you strategically wait a few more months? When bankruptcy is a good idea is usually impacted by some of these factors:
-Legal actions against you that could be aided by bankruptcy
-Income has only recently dramatically shifted
-You’re thinking of liquidating retirement assets
-You’re using loans to pay your bills
-You have a potential foreclosure
The website moneycrashers.com describes three of the above circumstances in which you’ll want to consider delaying bankruptcy for a few extra months. 1) If a usual amount of high income has only recently come to a stop (perhaps from the loss of a high paying job) 2) You have valuable assets that you wish to sell and turn into more practical objects 3) You’re expecting a large new debt soon.
When bankruptcy is a good idea is actually not dependent on the immediate financial difficulties of today. In order for the bankruptcy court to approve your case they will actually evaluate a snapshot of your finances for the past six months and also consider the foreseeable outlook for your situation in the months to come. You have to prove to the bankruptcy court that you are in need of bankruptcy be it Chapter 7 or Chapter 13.
Also there are obvious factors that would increase the urgency of filing for bankruptcy as soon as possible: Perhaps wage garnishments leave your family with insufficient funds to get thru each week, your future is quickly deteriorating as you chip away at retirement assets, or you are in danger of losing your home.
To know where you fall in the spectrum of when bankruptcy is a good idea for you call my office at 801-221-9911 to set up a FREE consultation.