No one plans for bankruptcy, but many people can fall into a situation where bankruptcy is their best option and not even realize it. The stress and accumulated debt aren’t going anywhere, so it can be precisely what the doctor ordered. When asking yourself if it’s time to file for bankruptcy, here are some red flags to look out for.
Signs That it’s Time to File for Bankruptcy
- You’re behind on your mortgage – The possibility of losing your home is definite cause for immediate action. As the most valuable asset you possess, your home is not something you can afford to lose. It’s worth what bankruptcy costs when it means holding on to this investment.
- You’re moving debt from one credit card to another – Making an occasional credit card payment using another one can be an apt financial move. It can help you to avoid higher rates on the first card. However, when this strategy becomes habitual, it’s a sign that you don’t have any alternatives to bankruptcy for paying off your debt.
- You’re making minimum payments on debt – Making minimum payments on its own isn’t always a red flag. But if you’re already living frugally and still have a large amount of debt to go, it’s going to be difficult to get out from under it without bankruptcy.
- You’re stressed and losing sleep – If you are losing sleep or have anxiety issues and have strong reason to believe the cause is your financial problems, it’s time to file. Yes, bankruptcy is a public matter, and you can’t hide it. However, you should always prioritize your own quality of life over any fears of what people will think of you.
Don’t let bankruptcy’s stigma cloud your decision-making abilities. When you’re struggling to pay back debt, or are only getting buried further, it’s likely your best option. Bankruptcy is stressful to go through, but it will have a positive effect on your financial stress. If you’re going through the warning signs above, it may be time to speak with a bankruptcy attorney.
Washington DC bankruptcy attorney Kevin D. Judd has made it his mission to help you find the best solutions available in your unique situation.