Bankruptcy is a choice many people don’t plan to do. It’s something they end up doing. Bankruptcy can knock on your door at any point in your life. It’s very tempting and easy to start over financially. So why anyone would fall prey to temptation and file for bankruptcy? A Troy, Ohio Bankruptcy Attorney offers the reasons why below.
The number one cause of bankruptcy filing is medical bills. An unexpected illness throws everyone for a loop. The uninsured have to pay the expense by their lonesome and paying it off is going to take years to do. Even with medical insurance, the remaining expenses are up to the patient and the patient’s families. It wipes out bank accounts, savings accounts, retirement accounts, home equity and student loans. As the bills keep piling up, it gets overwhelming for many families, which causes them to file bankruptcy.
Yesterday you’re on cloud nine because you have a job. The next day you’re fired or laid off. The blow to the head can cause many to file for bankruptcy. Many people who have jobs live paycheck-to-paycheck making their job the main source of income. Even people with savings or checking accounts can’t handle monthly payments to their car, house, cable, phone, credit cards, insurance, utilities and internet. Using credit cards to pay off bills is part of the problem. The bills are paid this month, but the bills are coming back along with a hefty credit card bill next month. Unless you can find a job immediately expect to file bankruptcy as soon as the bank account is empty.
Using a credit card to pay off medical or monthly bills is going to push your credit over the edge. Bad spending habits and lack of funds to pay the minimum balance contributes to the avalanche of debt. This mismanagement drives people to do the one thing they were avoiding – bankruptcy. Avoiding bankruptcy for a debt consolidation plan only works if the person is willing to change their spending habits. Without a change of heart, the person is delaying the inevitable.
Sometimes expenses come suddenly. Divorce, theft, natural disasters, fire or loss of a loved one is more than a financial drain. You’re dealing with emotional loss – whether it’s a person or personal property. In some situations, you will have to find somewhere else to stay. Sudden life changes throw us a curveball. It forces us to make drastic decisions we never thought we would ever do. The main drastic decision is bankruptcy.
Creditors are doing their jobs. They call people to inform them that a bill is due. Creditors also call too often. They harass customers to their breaking point. Many people file for bankruptcy just to get creditors off your backs. An automatic stay comes into effect stopping creditors from harassing you or collecting payment for a limited time. The courts will then deal with harassing creditors instead of you.
Filing for bankruptcy is a choice that will change your financial life forever. It has damaging disadvantages to negate the rose-colored advantages. However, when a wrench is thrown into our plans sometimes bankruptcy is the only way out. We are here to catch you. Contact us for more information.