Filing for bankruptcy is something that no one should enter into lightly. While it can help you get your debt under control, it can lead to a drop in your credit score and make some of your finances a bit more difficult to manage. But there are times when filing for bankruptcy doesn’t just make sense—it can dramatically improve your financial situation both now and in the future. So, how can you decide if it’s time to schedule a consultation with a South Carolina bankruptcy attorney? Watch for these tell-tale signs that you might need to file for bankruptcy.
You Have More Debt Than You Can Manage
One of the biggest benefits of filing for Chapter 7 bankruptcy is that you’re able to discharge most of your debts. Instead of having to make payments each month, the bankruptcy court will take possession of your personal assets and sell them to settle your debts. You won’t have to worry about interest accruing or having to stay on top of multiple payments to your creditors. Instead, most of your debts will be forgiven and settled through your bankruptcy.
Keep in mind that you’ll still have to pay overdue alimony and child support payments, back taxes, criminal fines and payments, and federal student loans. These debts are not discharged through bankruptcy.
Creditors Are Hounding You for Payments
When you miss a payment or two, most lenders and creditors are fairly understanding. They might even forgive those missed payments as long as you pay them what you owe and remain current on your payments in the future. But if you keep missing payments or stop making payments altogether, those creditors can become persistent. If you’re getting multiple calls, emails, and letters about your debts or are being hounded by collections agencies trying to get you to repay your debt, filing for bankruptcy could be a good choice.
When you file for bankruptcy in South Carolina, the court will issue an automatic stay. This stay prevents creditors from contacting you about your debt and lets you stop making payments until your bankruptcy case is settled.
You’re Relying on Credit Cards to Make Ends Meet
If you have to use your credit cards to cover routine expenses like utility bills, groceries, rent, and other essentials and are maxing your cards out each month, filing for bankruptcy could be a good choice. When you file for bankruptcy, you won’t magically gain access to more money. But you will be able to discharge credit card debt and other debts that are putting significant strain on your budget. This can free up cash to help you cover those expenses without going into debt.
You’re at Risk of Losing Your Home
Mortgage lenders expect you to make payments on time and in full each month. If you continually miss payments, stop making payments, or make partial payments on your loan, your lender could foreclose on your home. When they foreclose, they take possession of your home and can sell it to settle your debt, even if you have equity in your home.
If you’re facing foreclosure, filing for bankruptcy could be a good choice. Depending on how much you owe on the property, you may be able to keep your home. And even if you can’t keep your home, you may be entitled to a portion of the equity you’ve built in the property as part of your bankruptcy settlement.
Schedule a Consultation With a South Carolina Bankruptcy Attorney
Filing for bankruptcy can give you a fresh start if you’re in more debt than you can comfortably manage. But before you file, schedule a consultation with an experienced bankruptcy attorney in South Carolina. At Lam Law Firm, we’ll review your case and help you decide if bankruptcy is the right choice for you. Contact us today to schedule a consultation.
