How Do I Know if I Need to File for Bankruptcy?

Posted By Law Office of Simon Goldenberg, PLLC || 1-Jun-2018

If you are struggling to pay off your debts and can never seem to make a dent in them, you might be wondering if you need to file for bankruptcy. For many, the word itself inspires some fear and uncertainty, but the fact is that sometimes it is necessary to file for bankruptcy in order to start over and rebuild financial health. How can a person know when the time has come to proceed with this major decision?

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You can begin assessing your situation by asking some of the following questions:

  • Are you only making minimum payments on your credit cards?
  • Do you receive phone calls from bill collectors?
  • Are you uncomfortable with the mere thought of having to sort out your finances?
  • Do you typically use credit cards to pay for your necessities?
  • Are you considering a debt consolidation lawyer?
  • Are you uncertain about how much you owe?

If you answered at least two of these questions with a “yes,” it is time to give your financial circumstances a closer look and a little more thought.

First, you should take some time to inventory your liquid assets, including retirement funds, stocks, bonds, real estate, cars, and other accounts or funds. When you get a rough estimate of these assets, collect and add up all of your bills and credit statements. By evaluating your asset value and your overall debts you can now have a financial snapshot that is helpful in determining whether bankruptcy is a good fit. Make sure you consult with a bankruptcy attorney before you make any decisions. Bankruptcy is never something that should be done casually.

Declaring Bankruptcy

Depending on your circumstances, you can either file for a Chapter 7 bankruptcy or a Chapter 13 bankruptcy. Many individuals tend to file for a Chapter 7 bankruptcy since it generally offers a quick, fresh start by liquidating one’s assets to pay off as much debt as possible before wiping the slate clean. If you choose this option, your bankruptcy will stay on your credit report for 10 years, but considering how much you were struggling with debt, your credit was likely already in bad condition. The difference after a bankruptcy is that you will now be able to work toward achieving better financial health without the fear of piling debts. If you have assets or property you wish to keep, you might want to opt for a Chapter 13 bankruptcy instead.

A Chapter 13 bankruptcy is also known as a reorganization plan, enabling filers to pay off their debt over a period of 3 to 5 years. Debts that remain at the end of this period will be discharged.

Whatever your circumstances are, make sure you do not embark on this complicated process without skilled legal assistance to help walk you through it and ensure you are making the best decisions for your situation. You are setting the foundation for creating a better future, so starting it off right is crucial.

Bankruptcy Attorney in Brooklyn, New York

If you believe that bankruptcy could be your best course of action, call to speak with our skilled and experienced bankruptcy lawyers in Brooklyn to ensure you are making the right decision for your circumstances. We are highly rated by the Better Business Bureau, Avvo.com, Martindale, and Superlawyers. At the Law Office of Simon Goldenberg, PLLC, we are dedicated to assisting clients find the best, most effective solutions to achieve the financial relief they need.

Call our office today at (347) 389-0245 to schedule a free consultation with an experienced New York bankruptcy attorney.

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