If you have found yourself drowning in debt, you are not alone. Other people in Medina have found themselves in similar circumstances. For some, a few sessions of credit counseling might provide the solution they need. For others, they need something a bit more intensive. While bankruptcy often carries a strong negative stigma, you should think of it more as a debt relief tool. But, is bankruptcy the right choice for you?
There are several circumstances that point toward bankruptcy as your best option to get your debt under control. If any of the following scenarios apply to you, it is time to seriously consider bankruptcy.
Debt collectors are suing you
When you default on a debt, the owner of the debt usually turns it over to a collection agency. If the collection agency cannot collect the money from you, it may file a lawsuit in court. One way to get some legal protection is to file for bankruptcy. Once you file for bankruptcy, the court will issue an automatic stay against creditors. This action generally stays in place until you complete the bankruptcy process.
If a debt collector has successfully sued you for the money you owe, the court may have granted a petition for wage garnishment. This means that your employer is legally bound to withhold additional wages from your paycheck that will then go to the debt collector. An automatic stay through bankruptcy also provides protection against wage garnishment.
You can't make your monthly bills
If you do not have enough of a cash flow to pay for groceries, utility bills or other necessities and you have to instead use a credit card, then it might be time to file for bankruptcy. While poor money management habits typically is not a good enough reason to file for bankruptcy, there are other reasons why you might have found yourself in this position. For example, if your income has taken a hit or an unexpected medical crisis occurred, you might have a strong reason for filing for bankruptcy.
You are facing foreclosure
If your mortgage is becoming more and more difficult to manage and foreclosure is a real threat, then bankruptcy might be the solution you need. If you file in a timely manner, before the bank starts foreclosure proceedings, you may be able to buy yourself enough time to get back on track with your mortgage payments.
If any of the above circumstances apply to you, it might be time to take some serious action. Bankruptcy may be your best option to get your debt under control and get your finances organized.