If you are asking yourself if it is time to file a Chapter 7 bankruptcy, it's time to take a closer look at your financial situation. When you have debt that continues to grow every month and you have no idea how you are ever going to get back on track, a Chapter 7 bankruptcy may be the answer. If you are concerned about your credit rating and you are still on time with all of your bills, you may be able to consolidate some of your debt instead of filing for bankruptcy. Talk with your bankruptcy attorney when you are dealing with bills that are getting out of control and you are looking for a solution.
When Your Debt is Unsecured
Unsecured debt is things like credit card bills, car loans, and even your mortgage. If you still live in your home, a Chapter 7 bankruptcy can wipe away your unsecured debt without wiping out your mortgage if you choose to stay in your home. Unsecured debt is relieved in a Chapter 7 bankruptcy, giving you a fresh financial start when you need one. A Chapter 7 bankruptcy will stay on your credit report for 7 years, so understand that your credit will be poor for a number of years.
Debt You Can't Discharge
If your debt is mainly back child support, taxes, and student loans, this is debt that you can't discharge in a Chapter 7 bankruptcy. When these payments are taking over your life and causing you to fall behind on all of your debts, it can help to go on payment plans for your secured debt. To get your debts under control, consolidating your debts and paying the lowest interest rate that you can may help.
When You Want to Divorce and File a Bankruptcy
If you are looking to file a Chapter 7 bankruptcy and also file for a divorce, the timing of each is important. If both parties in the marriage are filing for bankruptcy, you can do this together. Wait to file for divorce so that the bankruptcy doesn't get complicated. If your divorce is already filed, wait until it is over to deal with your Chapter 7 bankruptcy.
Filing for bankruptcy is a personal decision. Talk to your Chapter 7 bankruptcy lawyer to learn about the process and see if it is right for you. If you are drowning in unsecured debt, it's time to see what your choices are.
