While the outcome of financial peril is the same, hundreds of thousands of Americans each year reach this dangerous point in different ways. Whether it was divorce, medical emergency or home repair, it is not uncommon for a single event to spell financial disaster. For many, though, overwhelming financial danger is the product of mounting debt over the course of years or even decades.
Even though every situation is unique, there are common warning signs that an individual must protect their financial future by filing either Chapter 7 or Chapter 13 bankruptcy, including:
- Intentionally leaving bills late or unpaid: It is not uncommon for individuals to examine what bills are due and decide to pay certain debt late to ensure they have the finances in place. In these situations, paying the late fee becomes a necessary evil. Worse, the payer might decide to simply leave the debt unpaid this month and suffer the ramifications later. These examples, unfortunately, signal you are facing overwhelming debt.
- Sacrificing one bill for another: When looking at the monthly statements, it is not uncommon for individuals to make tough decisions about which bills will actually get paid. Sacrificing a utility payment, for example, to pay for gasoline is an indication that you should explore the options provided by bankruptcy.
- Paying one credit card bill with another card: It is not uncommon for individuals to transfer balances to receive promotional rates or other benefits, but when an individual must make a credit card payment with another credit card as their only option, it can be a path toward financial disaster.
- Leaving no room for an emergency: While the replacement of a roof or HVAC system might run tens of thousands of dollars, few individuals even leave themselves a few hundred dollars for out of the ordinary expenses. If an unexpected expenditure of even a couple hundred dollars seems like a total disaster, you might consider your entire financial picture.
Most often, individuals decide to fight their way out of trouble. In finances, though, it can be hard to get ahead of mounting debt as it often continues to grow. While there are several strategies that could help you get out of debt, the government developed the Bankruptcy Code for this reason. Do not hesitate to learn more about your options and move forward to secure a strong financial future.