Declaring bankruptcy is not an action taken lightly by the party needing to take such a measure. It’s typically the last resort when handling debt, and the process can be costly and time-consuming. Still, it can be particularly helpful when filed in the right manner and time. The benefits of filing for bankruptcy include saving money, keeping creditors at bay, building credit, getting back on your feet financially and peace of mind. When is the right time to file for bankruptcy?
First, Make an Assessment
In simple terms, if you owe more to creditors than you can afford to pay, you are in a state of bankruptcy. Take stock of your liquid assets in order to figure out your financial standing. Do an inventory of sorts, covering things like stocks, bonds, real estate, retirement funds, etc. Move on to determining your debt, including all bills and credit statements. If the value of your debt is more than the value of your assets, filing for bankruptcy might get you of that financial hole.
Filing for Bankruptcy in Massachusetts
1. Faced With Long-Term Cash Flow Problem
If you are having cash flow challenges because your business is under-performing, you may need to make some tough changes. A bad quarter may lead to instances of late or missed vendor payments. While all may not be lost just yet, getting your business’s cash flow back in order should be a priority. When you’ve identified the early warning signs of cash flow troubles, you may take corrective measures to try and get back on track. If internal changes are no longer a viable option to fix your cash flow problem, it is time to file for bankruptcy.
2. Creditor Harassment
Credit card debt is perhaps one of the most popular reasons people file for bankruptcy. Life happens, and finances can get ruined when changes take place, such as reduced income in a household. This could be the result of a job loss, the consequence of which could amount to increased expenses and late payments. Falling behind on credit card payments usually result in creditors calling, maybe threatening to garnish paychecks. To end the harassment and phone calls and tackle your credit card debt, filing for bankruptcy could be a solid option.
3. Facing Foreclosure
Sometimes homeowners are either faced with mortgage loans that exceed what they can afford or simply fall victims to life circumstances. Either way, financial troubles can cause a person to lose their home. One way to avoid that disaster is to file for bankruptcy to help them recover and hold on to their home.
If you are facing a financial crisis and need a bankruptcy lawyer, contact Mike Tokatlyan to help you ease your financial burden and get you back on track.