Most of our clients come to us, struggling with massive debts that have spun out of control. We’ve shared lots of tips in the past for avoiding debt, but it’s also important to get advice from a financial advisor or bankruptcy attorney before you decide to file.
According to John Rao, a bankruptcy attorney with a Boston-based consumer advocacy group, you should “first explore opportunities to resolve problems outside of bankruptcy. Bankruptcy isn’t going to help everyone.”
Typically, you’ll want to consider bankruptcy if:
- Most of your debt is “unsecured” (such as credit card bills or medical bills)
- You’re hounded by calls from collection agencies at home and at work
- You’ve had wages garnished or your bank account frozen after a judgement
- You’ve been sued
Our attorneys are happy to talk to you about your debt situation and walk you through your options. If you’re struggling with out of control debt, call us at 214-760-7777 for a free consultation.
In the meantime, you should follow these bankruptcy tips:
- Take a look at your finances. As we’ve mentioned time and time again, you need to examine your finances to know where your problems are. Look at how much money’s coming in, how it’s being spent, and how much you owe. Bankruptcy won’t help if you don’t change the behavior that lead you to it.
- Check your credit report. There are many options for sites that pull your credit report for free. Take a look at your list of creditors and make sure it’s accurate. It’s a common mistake to think that a debt isn’t on your record simply because you’re not getting collection calls (or if it’s been charged off by the bank). When you file for bankruptcy, it’s vital that you include all debts and creditors on your filings.
- Don’t run up more debt right before you file. Many people think that if they’re about to file for bankruptcy, there’s no harm in running up additional debt before filing. That’s actually a huge mistake. If you rack up more debt in the last few months before you file for bankruptcy, that creditor might object to your discharge. In fact, if it can be proven that you incurred the debt without any intention of paying it back, that’s fraud, and you won’t be allowed to discharge the debt.
- Meet with an experienced bankruptcy attorney. You’ll need to meet with a bankruptcy lawyer who knows the process. Bankruptcy laws are too complex to try to represent yourself. Your lawyer will need a copy of the list of creditors – one of the big benefits of bankruptcy is that collection calls (and all collection efforts) must cease once you’ve successfully filed for bankruptcy.
It’s also important to point out that only the debts included in your filing are protected – so if you’re in a situation where you might get hit with additional medical bills, you don’t want to file too soon.
Bankruptcy is a wonderful thing, and we’ve helped thousands of hard working Dallas area residents get a fresh start. Call us today at 214-760-7777 to schedule a free consultation and we’ll walk you through all of your options.