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Struggling with debt? Here’s how to avoid bankruptcy

avoid-bankruptcy
Debt is pretty much a fact of life for most Americans, especially in today’s post-COVID landscape. Most families do not teach their children how to responsibly manage money, which leads to problems down the road. The majority of today’s workforce has learned money management through trial and lots of error.

It is far too easy to get overextended on your finances, and most people do not realize that they are in trouble until it’s almost too late. When you are already stretching your finances to the limit, any unexpected bump can send you down the road to bankruptcy.

If you are wondering if you’re overextended or starting to struggle with debt, the following signs show you are in danger:

    • You don’t have any savings, or you have to pull from your savings every month for expenses
    • Other than your car payment and mortgage, you could not pay off 100% of your debt within 1 year
    • You do not actually know how much you owe
    • You use new credit cards to pay off old credit cards or loans
    • You use credit cards for everyday expenses
    • You always pay only the minimum due on your credit cards
    • You have paid your credit cards late or skipped payments
    • More than 20% of your actual take-home pay goes towards debt

You do not have to be behind – if you’ve got credit card balances that never seem to get paid down because you are always making new charges, that is a dangerous situation. A sudden accident with big medical bills or even the loss of your job would send you spinning out of control.

If you said yes to any of the items above and think you might be overextended, you should take immediate steps to get your financial situation under control. If you can regain control and stay on a healthy path, you’ll be able to avoid filing for bankruptcy.

Here’s how to get your finances on track:

  1. Figure out exactly what you owe. It can be scary to sit down and look at the big picture, but you need to know the exact number. Once you know exactly what you owe, you’ll be able to make a plan.
  2. Look at your total take-home pay for a single month. This is the most important number, because you have to create a plan where you’ve got more coming in than what you’re spending.
  3. Create a detailed budget. Figure out what you have to spend for the essentials – shelter, utilities, food, and transportation. Don’t count your credit cards or any other expenses here – you need to set your number for necessary expenses so you know what’s left over each month.
  4. Take the money that’s left over and start applying it to your debts. Pay the minimum amount due on every debt except one, and push as much as you can afford towards that balance. Once you’ve paid off that debt, move on to the next. If you make a solid, realistic plan for paying off your debts, it’s much easier to stick to your budget and be responsible with your money.
  5. Once you’ve paid off most of your debt, start saving. Build up your savings in case an unexpected event comes up – you don’t want to have to start all over!

Most importantly – stick to your budget even after you’ve paid off your credit cards. If you stick to your budget and plan ahead for big purchases, you’ll find that it is easy to stay on top of your finances and avoid debt altogether.

By |2022-10-02T14:06:21-05:00September 29th, 2022|Bankruptcy, Debt, Personal Finance|

Should I file bankruptcy?

should i file bankruptcyWe have helped many hundreds of Dallas-area residents with their bankruptcy cases over the years, and the most common question we hear first is “Should I file bankruptcy?”

When you are drowning in uncontrollable debt, you are inevitably stressed and scared – and bankruptcy seems like a huge step to take. That is why we offer free consultations. We want to help explain every step of the process and all possible outcomes, so you will be able to make the right decision for your situation.

Let’s look at the advantages and disadvantages of bankruptcy and ways to decide when bankruptcy might be the right decision for you.

What exactly is bankrtupcy?

The federal government established bankruptcy laws to allow individuals and businesses a way to get relief from debts that they are unable to pay back, in order to get a fresh start. The laws were created so that honest people who had unfortunate circumstances could get a clean slate and start over. (more…)

By |2022-09-01T09:07:21-05:00August 30th, 2022|Bankruptcy|

Recession 2022 – is it coming, and what does it mean?

The Great Recession hit America hard from December of 2007 to the middle of 2009, millions of US residents lost their livelihoods and homes. It was the worst economic downturn since the 1930s and the Great Depression, and it took almost a decade for the labor market to fully recover.

There are very few people still alive who remember the Great Depression, so the recession in 2008 is the only true recession that most Americans have experienced. Sure, we hit a downturn when COVID restrictions locked everything down in 2020, but that was not a true recession.

Because most people have only experienced the recession of 2008, all of the predictions of a “major” recession in 2022 have most of the population freaking out – but recessions are a perfectly normal part of business cycles. Many economists agree that a worst-case scenario is not likely in 2022. (more…)

By |2022-08-01T11:24:58-05:00August 1st, 2022|Bankruptcy, Debt, Financial|

What not to do before filing for bankruptcy

what-not-to-do-before-bankruptcyWhile most of our potential clients ask about what’s involved in a bankruptcy case, and what they need to do when they are filing, many forget to ask what NOT to do… And the things you shouldn’t do before filing are just as important as what comes afterward.

In fact, there are several things you could do before your bankruptcy case that could cause major complications – and could possibly even cause your case to be denied!

As we always say, the most important thing to do when considering bankruptcy is to meet with an experienced bankruptcy lawyer. The advice and guidance you will receive are vital to avoiding bumps in the road during your case.

So, for anyone out there who is considering bankruptcy and has not talked to an experienced attorney yet, here are the five most important things you should avoid doing before you file for bankruptcy: (more…)

By |2022-06-01T11:28:34-05:00February 24th, 2022|Bankruptcy, Debt|

Mortgage forbearance ending – how do you keep your house?

eviction because of COVID
We are coming up on two years of the COVID-19 pandemic – clearly, no one thought it would last this long. Many Dallas-area residents have had to take significant pay cuts or have even lost their jobs. Our firm has helped hundreds of DFW residents get a fresh start after COVID-related problems caused unmanageable debt, but many other people in the area are still struggling.

Most of the foreclosure and eviction moratoriums have ended recently, so many Dallas residents are wondering how they’re going to keep their homes. Rubin & Associates is here to help! We have put together this blog post to help answer some of the common questions we’re hearing about the end of mortgage forbearance. (more…)

By |2022-06-01T10:57:28-05:00November 30th, 2021|Bankruptcy|

4 Scary Ways to Damage Your Debt

5 scary things that can damage your creditIt is Halloween this weekend, so we had to share something scary here on the blog… and this time, we are sharing 4 Scary Ways to Damage Your Debt. Let’s face it – nothing is scarier than overwhelming debt that spirals out of control.

If you are not careful about how you spend your hard-earned money, and even how you conduct transactions online, you can easily start down the path to crushing debt. Today’s post is going to examine the 4 most horrifying ways you can head down a scary financial path.

1. Hackers and scammers

Digital thieves have become incredibly creative – you need to be extremely careful whenever you provide your credit card number to ANY online service. Charities are a common ploy, so make sure you do research on a charity before you make a donation – especially if you are solicited at your front door or over the phone.

(more…)

By |2021-10-29T12:44:53-05:00October 29th, 2021|Bankruptcy, Debt, Money Management|

6 Tips For Avoiding Bankruptcy

tips for avoiding bankruptcyThe proliferation of credit cards and the “gotta have it now” American lifestyle have lead to a problem: for many Americans, living with debt is par for the course. The changes in America’s financial landscape due to COVID and resulting lockdowns have only made things worse. In many cases, debt spirals out of control until filing for bankruptcy appears to be the only way out.

Most of our clients are regular, hard-working DFW-area residents who simply hit an unexpected bump in the road. Whether it was the loss of a job, reduction in wages, or an accident, a single speed bump on the road of life can send you in a completely different direction.

Once you start living on credit and spending more than you can afford to pay off, the debt multiplies quickly until it seems like there’s no escape. (more…)

By |2021-09-26T14:26:16-05:00September 26th, 2021|Bankruptcy, Debt, Personal Finance|

Considering bankruptcy? Follow these 4 tips

4 bankruptcy tipsMost of our clients come to us, struggling with massive debts that have spun out of control. One unforeseen bump in the road (a sudden job loss, an accident, a medical condition) is all it takes to send most families into a downward debt spiral. We have shared lots of tips in the past for avoiding debt, but it is 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 will want to consider bankruptcy if:

  • Most of your debt is “unsecured” (such as credit card bills or medical bills)
  • You are hounded by calls from collection agencies at home and at work
  • You have had wages garnished or your bank account frozen after a judgement
  • You have been sued

(more…)

By |2021-07-19T11:17:21-05:00July 19th, 2021|Bankruptcy, Debt|

New York man dodges eviction for 20 years by abusing the bankruptcy system

One of the most common reasons that people file for bankruptcy is to stop foreclosure actions. Rubin & Associates help DFW area residents and property owners with cases like these quite often.

Every once in a while, stories pop up about people who abuse the system, and one of the most extreme cases we have ever heard hit the news last month. Reported in major publications like Fox News and the New York Post, a man in New York has avoided eviction for more than 20 years by filing multiple bankruptcy cases.

According to the article at the New York Post, the man bought a Long Island home for $290,000 in 1998 and made his first mortgage payment to his lender, Washington Mutual – and that’s the only payment he ever made. He has claimed bankruptcy seven times and filed four lawsuits over the years, all focused on letting him stay in the home. (more…)

By |2022-06-01T11:19:02-05:00June 30th, 2021|Bankruptcy|

Should I File For Bankruptcy?

Filing for bankruptcy is a huge decision, and usually it has to be made under pretty extreme stress. Your circumstances are unique – so the best way to know if you should file is to call us at 214-760-7777 for a free consultation. The pandemic and ensuing lockdowns have made the situation even more stressful for many DFW area residents. This post will help answer a few high level questions, but it is always better to talk to an expert to get answers about your specific situation.

In general, these are a few of the most important questions to consider before filing for bankruptcy:

  • Can you pay back your debts outside of bankruptcy?
  • Are creditors suing you to collect their debts?
  • Are you facing foreclosure or repossession of your property?
  • How much property do you own?

Can you pay back your debts outside of bankruptcy?

Before you decide to file for bankruptcy, think about the types of debt you are trying to eliminate – and consider whether you can pay off those debts outside of bankruptcy. For example, if your main struggle is credit card debt, determine whether you can really afford to pay it off. If you make enough money to pay back your credit cards, you could consider consolidation, where you combine them into a single loan or settle your debt with the credit card company. (more…)

By |2021-05-25T16:27:55-05:00May 25th, 2021|Bankruptcy, Personal Finance, Texas Bankruptcy|
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