Filing bankruptcy is not a decision to be taken lightly. While it certainly has its fair share of benefits, it will have a major impact on your credit history, making it more difficult to obtain a loan or low-interest credit card. As such, it’s important to educate yourself on the bankruptcy process, benefits, and consequences before taking the plunge. Below, attorney Rafael Gil III from The Gil Law Firm in Dothan, AL, discusses several factors to consider prior to filing.
3 Things to Consider Before Filing Bankruptcy
1. Is Bankruptcy Right for You?
Not everyone is a good candidate for bankruptcy. Take the time to assess your finances and goals while considering the impact filing might have on your future. If you are able to pay more than your monthly minimum payments, can commit to paying off your debt within the next five years, and are gainfully employed, bankruptcy may not be the best option for you. However, if your wages are being garnished or your home is at risk of being foreclosed, filing may be able to provide you with some much-needed relief. When in doubt, consult with a seasoned bankruptcy attorney to determine the best path forward.
2. Not All Debt Can Be Discharged
Many people assume bankruptcy can eliminate all debt. Unfortunately, this is not the case. Certain debts, such as back child support, unpaid taxes, and alimony cannot be discharged by bankruptcy and must be paid in full. If you are considering bankruptcy as a means to address these issues, you’re better off going a different route. However, if you are struggling to pay off credit card debt or medical bills, bankruptcy may be the way to go.
3. You May Not Be Eligible
Not everyone is eligible to file bankruptcy. For instance, in order to qualify for Chapter 7 bankruptcy, you must show that you are unable to repay your debts. If you can repay them, you will not be eligible to file. Debtors who have filed bankruptcy in the past may also run into trouble. If you have filed for Chapter 7 in the past eight years or completed your Chapter 13 bankruptcy in the past two, you will likely be forced to investigate alternative options.
If you are considering Chapter 7 or Chapter 13 bankruptcy in Dothan, AL, The Gil Law Firm is the place to call. Serving Alabama, Georgia, and Florida clients since 2000, The Gil Law Firm has you covered for the experience, guidance, and solutions you need to enjoy the fresh financial start you’ve been searching for. Consultations are available. Visit the firm online or call (334) 673-0100 to schedule an appointment.