Who Should Consider Bankruptcy?

Who Should Consider Bankruptcy?

It’s a scary thing to admit when your financial situation has gotten out of your control. You certainly didn’t mean for things to end up like this. It could be anything from a loss of employment or illness or other economic hardships that brought you to a place where you’re not sure where to turn or what to do. You may have a friend or a family member who has gone through a bankruptcy but weren’t considering the process for yourself until you found yourself in your current condition. Is bankruptcy the best way to handle your fiscal worries? See if any of the following sound similar to what you’re going through.

Growing debt

The debt hanging over your head just gets bigger and bigger with no chance of outrunning it. You’re giving everything you can afford to give, but nothing’s getting cleared up. In fact, your debts are growing larger and you’re having difficulty just making minimum payments. Your financial situation is a race and you’re just falling farther and farther behind no matter how fast you run. You can attempt to take care of all the debt yourself, but if there’s so much it can’t all be paid off over the next 36 months, you may want to think about bankruptcy as the way to break the vicious cycle.

Saving your home
When you first bought your home, things were probably a lot better for you financially and it was unimaginable that you would be in a scenario where you could lose your house. With the recent economic turndown, especially in the housing market, many homeowners are facing that exact fate with few options to exercise. What’s worse is that in many cases, a foreclosure will not remove a second mortgage, leaving you with the debt but no home. Bankruptcy has helped those homeowners who fear losing their homes and the effects of a foreclosure on their financial well-being.

Retirement at risk
When you’re thinking that cracking open your nest egg is looking like a good idea, stop. It can seem tempting to quickly put an end to your financial nightmare with your retirement savings, but that is a dangerous idea at any age, especially as you get closer to your retirement years when you’ll really need to have those funds available. Even taking a loan out against your retirement account can be fraught with risk. To your worried mind, it may seem like there’s no other way out, but that isn’t the case. The temporary process of bankruptcy will be easier to go through than spending all of your golden years with little to no funds.

When the situation you’re in is the result of unforeseen circumstances befalling you, the rules regarding bankruptcy were put in place to protect you and your family. When no other options available will free you from the worry and stress of your predicament, perhaps you should look closer at bankruptcy as a viable possibility. Even if you don’t decide on bankruptcy, reviewing all your alternatives is an empowering thing to do.

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