Money struggles, past due bills, and less money than month are all signs that your finances are in disarray. Sometimes tightening the belt allows you to catch up, but sometimes this isn't enough. In this case, bankruptcy may be the solution you are seeking. The following signs mean that you should seriously consider bankruptcy:
#1: Your bills are greater than your income
It's impossible to catch up if your bills are greater than the amount of money you can bring in monthly. This applies only to those expenses where you can't control the expense, such as mortgage, minimum credit card payments, and loan payments. If your non-fixed expenses, such as groceries or gas, are what push you over the edge, you may have room to adjust your budget.
#2: You have no savings
If you have savings that you can touch without penalty, which generally means non-retirement savings, then using this to pay off your debts is usually a better option than bankruptcy. On the other hand, if you have no savings then bankruptcy is likely a good option. Don't be tempted to dip into retirement to avoid bankruptcy, though. Often, retirement savings is protected during bankruptcy, so save this so you aren't destitute in your golden years.
#3: Creditors are hounding you
When the sound of a ringing phone or the mail arriving puts you on edge, then chances are you are in over your head. Creditors calling, sending certified letters, or threatening repossesion are all signs that bankruptcy may be the best option. It will give you a chance to start over with a clean slate, so you can develop a lifestyle that fits into your financial means.
#4: Homelessness is a real threat
Are you in danger of losing your home or being evicted from your rental? Once you are homeless getting out of debt will become even more difficult, as it is hard to keep a job or save money in this instance. Before things get to this point, look into bankruptcy to see if it is an option. Often, you can keep your home during bankruptcy if the mortgage payments are manageable after your other debts are discharged.
#5: Paying debt with debt
Bankruptcy is usually the solution when you are taking on greater debt loads to pay your existing debt, such as making house payments on teh credit card or taking out loans to pay off existing debt.
If you think bankruptcy may be a solution, contact a bankruptcy attorney in your area.