At the start of a new year, American tradition dictates that people set resolutions for the months to come. Understandably, individuals struggling with debt often pledge to improve their financial situation over the upcoming 12 months. However, simply resolving to rid oneself of debt will not provide the fresh start necessary to do so. Bankruptcy, however, can do just that — provided the situation calls for it.
Here are a few signs that exploring personal bankruptcy options with a West Palm Beach bankruptcy attorney may be beneficial in 2018.
Debts Outweigh Assets
At the most basic level, the decision to file bankruptcy should be driven by whether or not one is facing debt he or she cannot reasonably overcome. One key indicator of this is when an individual’s monthly income is exhausted or surpassed by monthly debts, even after cutting back in any ways they are able. If the debtor is unable to keep up with debts as they accumulate, and would not be able to satisfy those debts if all their assets were liquidated, bankruptcy is worth considering.
There Are No Viable Alternatives
If there are less severe debt-relief options that have not been considered, it is important that a debtor explore these options before pursuing bankruptcy. For instance, the borrower may be able to negotiate a repayment plan with the lender that allows them the time needed to get their finances in check. The debtor may also be eligible for refinancing or debt consolidation. Credit counseling can also be helpful for overcoming debts, which is one of the reasons it is required before a bankruptcy filing is accepted. If these alternatives are deemed unattainable or ineffective, it may be time to file bankruptcy.
The Debtor Can Afford To File
Unfortunately, the bankruptcy process is not free, nor is it cheap. Therefore, if one is unable to front the funds necessary to pay for the longterm relief bankruptcy could provide, it may not be a reasonable option. Furthermore, if it is determined that the debts eligible for discharge are not much greater than the cost to achieve discharge, bankruptcy may not be advisable either. Additionally, some in financially-driven sectors may put their livelihood at stake by having a bankruptcy on their credit report. A potential employer may uncover this information in a background check, which could ultimately call into questions regarding the applicant’s ability to manage money effectively and possibly lead to a rejection, regardless of whether the presumption is justified.
If you have noticed any of these signs and are considering bankruptcy, a West Palm Beach bankruptcy attorney at Kelley & Fulton can answer any questions you may have about filing. Contact our office today to schedule a free consultation with one of our experienced bankruptcy lawyers.