4 Reasons You Want To Wait To File For Bankruptcy

Posted on: 10 November 2016

Filing for bankruptcy is something that is definitely helpful for someone who has a great deal of debt and an income that is too low. This way, your debts are written off and you can start building your credit back up without a significant amount of debt holding you back. However, bankruptcy isn't always the right solution. Here are four reasons to wait before filing for bankruptcy:

  1. You Haven't Modified Your Mortgage: If you are able to modify your mortgage loan on your home, you should try this first before filing for bankruptcy. This can help you avoid foreclosure in a much better way than filing for bankruptcy because now you won't have a bankruptcy file on your financial record. However, if you are not able to modify your mortgage or if you have tried to and it didn't decrease enough to help you continue to avoid foreclosure, then you want to talk to a bankruptcy attorney about your next best move.
  2. Your Income Has Recently Been Raised: If you have recently received a raise at work or are now working at a job that is paying you more, than you may want to wait to file for bankruptcy. This is because, in these types of situations, you are likely going to be ineligible for Chapter 7 bankruptcy and will instead have to file for Chapter 13, which is where you have to repay some of the debt at some point. 
  3. You Will Have New Debt Soon: If you are going to acquire some new debt soon, you should wait to file for bankruptcy so that this debt can be included in your case. However, you should try your best to avoid accumulating more debt if you are considering bankruptcy. 
  4. You are Only Stressed About Old Debts: If you have old debts that are bothering you, you can easily fix them by making payments or simply letting them sit until you can pay them off. Old debts do affect your credit, but not as much as new debts. On top of this, if you have already been letting these old debts sit and haven't been paying them, you can continue to do so until you have the means to pay them. 

When you know the four reasons to wait to file for bankruptcy, you can be sure that you make the right choice in your particular situation. If you are still unsure, talk to a bankruptcy attorney. They will be able to give you an idea as to whether or not bankruptcy will help or hurt you.