Filing for bankruptcy is never an easy decision but sometimes it must be done. There are a number of factors that go into the decision for filing and only you can determine if your situation falls into one of the categories. Below are six reasons why some people choose to file for bankruptcy.
A recent study found that this is one of the most common reasons, especially for single income households. When the income is gone, bills cannot be paid.
If you have been sued by someone that you owe, filing a bankruptcy can, in most cases, stop the lawsuit and wipe out the debt associated with the suit. Also, by filing a bankruptcy, you can usually avoid a wage garnishment or bank levy that might follow if the lawsuit concludes with a judgment against you.
When someone is seriously sick or injured, most of the income goes to providing adequate care. This means other bills are put off. Filing can eliminate most, if not all, medical bills.
Filing for bankruptcy can prevent you from losing your home. It will not remove your obligation to pay the mortgage, but will restructure payments to make them more manageable.
If your car is in danger of being repossessed, filing for bankruptcy can stop the process. Even if your car has been taken, bankruptcy may get your car back.
If you are under a mountain of debt and get calls all the time, filing can stop the harassment and phone calls.
While these six situations are common ones that may cause someone to file a bankruptcy, there are certainly other circumstances that can make filing a wise decision. Should you have any concerns about your financial situation, please do not hesitate to contact a licensed attorney to help you determine what options exist for improving your financial condition.
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