If you’re struggling to meet overwhelming financial obligations, bankruptcy can offer a way out by discharging or reorganizing your debts. Unfortunately, many distressed borrowers put off this decision, which creates unnecessary stress and racks up late fees and charges. Knowing when to seek bankruptcy protection will help relieve the pressure and allow you to start your financial life over again.

5 Signs It’s Time to File for Bankruptcy

1. You Can’t Afford Your Monthly Payments

Once you’ve fallen behind on a debt, catching up can be extremely difficult without a dramatic increase in income. If you’re already unable to make your monthly payments and don’t expect a significant raise in the near future, bankruptcy may be your best option.

2. You Can Only Afford the Minimum Payments

In the long run, paying only the minimum payment on a credit card can cost several times more than you originally borrowed. Filing for bankruptcy allows you to use those funds to rebuild your life, rather than spending it on interest fees.

3. Creditors Are Suing You

If your creditors win a lawsuit and receive a judgment against you, they may gain the right to garnish your wages or seize some of your assets. Filing for bankruptcy automatically puts an immediate stop to all collection activity, including lawsuits and wage garnishments.

4. Collection Agencies Continuously Contact You

Being unable to pay your bills is already a stressful situation, but phone calls and letters from collection agencies only make it worse. The automatic stay triggered by a bankruptcy petition requires all creditors to stop contacting you immediately.

5. You Are Facing Foreclosure

Many mortgage lenders require full payment of all past due amounts, so making up arrears can be nearly impossible. A Chapter 13 bankruptcy may allow you to pay back missed mortgage payments over time, potentially preventing foreclosure.

For 30 years, struggling borrowers throughout the Cincinnati area have relied on Nancy V. Jacob for debt relief solutions that work. She prides herself on giving her clients the individual attention they deserve, and she will carefully evaluate your financial situation to determine whether bankruptcy is right for you. Visit her online for more on her background and services, and call (513) 921-1400 to arrange your free consultation.