It's no secret that when someone is completely broke without any way to pay their bills, filing for bankruptcy is often the only way out. However, determining when you're really broke and otherwise helpless is not as easy as you might think. Many people wonder for years whether they're at the point where they should file for bankruptcy. However, if you recognize these five signs in yourself and your finances, it's time to talk to a bankruptcy lawyer.
1. You're months behind.
Being one month behind on a bill or two is one thing. Everyone has bouts of bad luck, and you can catch up in a month or two. On the other hand, if you are several months behind on several or all of your bills, this is a sign that bankruptcy is in your future. If they have not done so already, the companies who you owe money to will start resorting to more drastic measures to get money out of you -- like foreclosing on your home and sending your account to collections.
2. You're continually getting calls from debt collectors.
Do you feel like you can't even pick up the phone because it's always a debt collector calling? Maybe these debt collectors have begun to call your family and friends, and maybe they are reaching out to you at work. Nobody deserves to have their life invaded in this way. If you're so behind you can't settle on the debt to keep the debt collectors at bay, then filing bankruptcy is a worthy escape. As soon as you file, the debt collectors will be prohibited from trying to contact you again.
3. You've taken out a home equity loan and can't pay it back.
Sometimes, homeowners take out home equity loans as a way to pay off other debt. They're then left with just one consolidated debt to pay -- the debt on their home. However, when this approach backfires and you cannot even afford to pay back the home equity loan, your home is in danger. The bank can and will foreclose on your home if you fall too far behind. Rather than let this happen, you should file for bankruptcy, which will protect your home and ensure you have a place to keep living.
4. You can't even make the minimum payments.
Add up all of the payments you are expected to make each month. Include your car loans, credit card payments, mortgage payments, electrical bills, and anything else you need to pay each month. How much does the total come to? Compare this to your monthly take-home salary. If the total you are meant to pay each month is more than the amount you bring home each month, then there's really no way for you to dig out from under your pile of debt -- other than getting a much higher-paying job or declaring bankruptcy.
5. Your credit cards are at the limit.
This situation in and of itself does not always warrant declaring bankruptcy. However, if you have noticed some of the other signs above, the fact that your credit cards are maxed out is further evidence of your need to file bankruptcy. Usually, once this happens, you won't be able to get ahead of paying off the debts. You may be able to make the minimum payments each month, but if that's all you do, you'll be making payments for the rest of your life.
If you have noticed any of the above conditions in your life, it's time to call a bankruptcy lawyer such as Charles J Schneider PC. He or she can help you file the necessary paperwork to get the process started.