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Start the New Year Fresh: Is Bankruptcy the Best Option?

New Year, New You! January is a great time to wipe the slate and focus on your priorities and goals. While some people are cutting calories and exercising to lose weight, others want to focus on their financial fitness this year.

But it can be hard to improve your finances if you are weighed down by high debt balances and creditors calling. If you are looking to improve your finances this year, you might be considering the option to file bankruptcy. Here are a few signs that bankruptcy is right for you:

Non-Stop Collections Calls

It can suck the life out of you to be dodging collections calls and letters each day. When you are falling behind on debt payments, there’s a good chance that many of your accounts have been sent to collections. The benefit of filing bankruptcy is that these accounts are put in “automatic stay,” which means collections efforts are stopped with the bankruptcy filing.

Wipe Out Certain Debts

Many people find it impossible to meet all the payments required for personal debt, including credit cards and loans. If you are falling behind, then bankruptcy might be the right answer. Filing Chapter 7 bankruptcy means that some of your account balances can be wiped clean, such as:

· Personal loans

· Medical bills

· Credit card balances

· Past-due rent and utility bills

· Business debt

· Civil judgments

Keep in mind that some debts will remain after bankruptcy, such as recent tax debt and child support payments.

Credit Report Difficulties

One common issue with heavy debt loads is that it can be challenging to access additional credit because your credit score is so low. If you face a credit history problem, then filing bankruptcy might be part of the solution.

Important note: a bankruptcy will take a toll on your credit score and access to credit. Filing right now opens up your options for new credit lines in the future.

Turn Your Finances Around

If you feel like you are digging a financial hole deeper and deeper, then it might be time to evaluate new strategies for your finances. Of course, bankruptcy isn’t the right solution for everyone, but it might be something to consider depending on your circumstances. For more information about bankruptcy filings, our team is here to help. Call Miles & Hatcher, LLP at (909) 481-4080 for a consultation.

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