We read about bankruptcy almost every day. Even the biggest companies in the world are not immune to spiraling into debt. It is a fearful term and one that conjures depressing images of broken dreams. But there is a lot about bankruptcy that we do not understand. Bankruptcy is an important step in acknowledging the failure of your current financial plan. More importantly, it is the first step you take to turn things around.

When do you file for Bankruptcy?

Understanding your financial health and potential is a very important part of life. Bad decisions and bad luck can cause your life to unravel as you try to keep up with increasing debt. Here are some signs that you may need to consider the step of bankruptcy.

Take a close look at your recent credit card payments. Have you been scraping past the minimum payments? It is a sign that your debts are not under your control anymore. Normally when we make credit card purchases we have an idea of how long it would ideally take to complete those payments. If you are not able to pragmatically consider a payback timeline when using your card that is an alarm bell.

Make an inventory of all your assets. The math will dictate whether you have the immediate capabilities to take care of your debt. Assets include the different bank accounts and funds you may have invested in.  Now make a chart of your potential income for the next few months. If you see no major improvements or spikes in income happening any time soon it means that your debt will increase (if you are able to only make minimum card payments).

Bankruptcy can be filed in two ways. A person can voluntarily file for bankruptcy or creditors can plead through a court case to declare the concerned person as bankrupt.

Understanding Bankruptcy

Bankruptcy is a situation that we all try to avoid but in a worst-case scenario, it offers that one chance to revitalize your finances in a protected environment. There are many ways filing for bankruptcy protects you. It helps eliminate a certain amount of a person’s debt which allows him or her to make a fresh start. Some of the debts it can remove include credit card debt and other unsecured loans. It also depends on which chapter of bankruptcy you file for. A legal expert is required to give you the best advice based on your unique requirements and situations.

Bankruptcy will also, to an extent, bring you peace of mind. You will no longer be hassled by your debtors. This includes calls from credit card companies. Bankruptcy can also prevent your car from getting repossessed or your mortgage from getting foreclosed.

There are certain debts that a bankruptcy filing cannot protect you from. This includes liens. If the creditor has secured one of your assets in exchange for the loan you took, bankruptcy does not prevent the repossession of that asset. Bankruptcy also cannot be used to remove the obligations of child support and alimony. Student loans also will not get removed although there are certain very special cases where bankruptcy has been used to waive them.

Your bankruptcy lawyer can help negotiate reasonable reductions in the amount of money you owe your creditors. A popular example is when you owe a certain amount for a vehicle bought but you negotiate a reduction of the final amount to be repaid. The new amount is equal to the present worth of your vehicle rather than the original price.

Find the Experts

When you file for bankruptcy, understand that the laws are in place to protect all the stakeholders, and that includes you. It is very important that you find a good practitioner who has prior experience in dealing with cases like yours. Find a bankruptcy attorney near Dallas who will give you the best support possible.

There are many advantages of getting a lawyer who specializes in bankruptcy. You will receive insights and perspectives that you did not have before. Legal experts are armed with information about the granular details of bankruptcy – they will advise you to make the right moves and choose the right strategy so your future is protected.

Apart from bankruptcy, you can also reach out to legal experts to eliminate your debts. Some of the common debts that can be eliminated include foreclosure and wage garnishment. The average individual American owes banks more than 6000 dollars and bad credit habits is a big reason behind many bankruptcy cases. Legal experts offer credit counseling and credit repair services to ease the burden on your shoulders.

Bankruptcy allows you a new beginning. Swallow the bitter pill for a more secure future. Find a good lawyer who will be your guide, friend and closest advisor in these difficult times.