To file or not to file bankruptcy: that is the question

The decision to file for bankruptcy is an important one and should not be taken lightly. Many people who are faced with their own financial cliff choose to bury their heads in the sand rather than face the problem head on. This can have devastating consequences in the long run, possibly costing them more than they thought if they had just been proactive from the start. For these people, using bankruptcy should be a serious consideration if any of the following situations is something they are currently facing. If after paying all of their monthly living expenses (mortgage, rent, food, insurance, clothing, utilities) they only have $200 or less, then filing for bankruptcy may be right for them. Perhaps they recently lost their job, were laid off, or had a reduction in income due to a reduction in their hours. Personal problems, such as a medical illness, or perhaps even a divorce, could force a person into deep debt. If an individual’s debt consists primarily of credit card debt, medical bills, or personal loans, then they would also be a candidate for filing. Finally, if the individual is being harassed by creditors, or facing wage garnishment, repossession, lawsuit, judgment, or foreclosure, then he or she should seriously consider the benefits of bankruptcy.

Sure, filing for bankruptcy can be an emotional decision, but it no longer carries the same negative stigma that it did years ago. Millions of Americans have had to declare bankruptcy, including famous actors, singers, and athletes. Large corporations routinely show up to restructure and come out leaner and stronger, so it should be no different for the average American to do the same. After all, the reason bankruptcy was created was to give honest, hard-working Americans a financial fresh start. Without the ability to file bankruptcy and clean the slate, this would not be possible. Why deal with creditors constantly calling and threatening when a person is going through a serious illness or has lost their job and can’t find work? Creditors have become very assertive and intimidating and don’t want people to know that filing is an option. They will say anything to threaten the debtor with claims such as that they are lazy and just want to stop paying their bills, or that they will go to prison for not paying their debts. This is simply not true.

In the first place, there are no longer debtors’ prisons. Second, most people who file for bankruptcy have experienced a large loss of income due to job loss, serious illness or accident, divorce, or death of a breadwinner. Filing bankruptcy is not something anyone wants to have to do, but sometimes life circumstances beyond one’s control make filing bankruptcy the only way to get out of insurmountable debt. When someone finds themselves in this bleak financial situation, the question should not be whether or not to file bankruptcy, but rather how soon can I start filing bankruptcy so I can get back on the road to recovery.