Monday, June 23, 2014

Can You Try Too Hard To Avoid Bankruptcy? you usually of the mindset to do everything possible to pay all your bills, liquidating everything possible to try to avoid filing bankruptcy, and then, as a last resort, file bankruptcy. Bankruptcy should be a last resort, referring to a financial plan, and doing things according to the plan, not just doing things to do things. Last resort does not mean do everything you can think of, regardless of what it is.

You have heard the phrase you should do things Smart, not just Busy.
The thing about the bankruptcy code, it does not necessarily make logical sense. Often one can do something whereby they think they are helping themselves, just to find out later they were actually hurting themselves, both financially and emotionally. And all because they did not take advantage of a free bankruptcy consultation.

An example
The following is a general scenario that is not uncommon given the following general facts:
  • Double wide mobile home (12 months of payments left);
  • 5 acres of land in a rural part of county in Florida (paid for);
  • $30,000 in a retirement fund;
  • a vehicle - owed $25,000, worth $17,000; and
  • significant debt on credit cards and medical bills.
One other small fact, a recent downgrade in jobs; lower income.
Does this sound remotely familiar?
After liquidating retirement funds, refinanced the home to include the land for some money to pay bills. Later ran low on money, vehicle repossessed, and the real property sold at a Short Sale.
A bankruptcy consultation would have revealed the retirement funds could have been saved, and the home probably could have been saved. The car, depending on income and equity in the vehicle, could have probably been saved. Credit card and medical debts, most probably discharged in bankruptcy.
This is an example of waiting too long to receive a consultation so one can plan their affairs around the filing of a bankruptcy.
Please keep in mind, no 2 cases are the same. Every case is different, and you should seek the advise of a local bankruptcy attorney in your area.

1 comment:

  1. Filing a bankruptcy is hard for my client accept, this is very traumatic for them since they are not understanding the legalities covered by their case. It's not the end of the road, many famous personalities filled a bankruptcy because it is their last option to save their property for possible foreclosure. Assessing your options and your goal a Bankruptcy lawyer in Long Beach can help you to decide what is your best options to pay your debt.