Are creditors or debtor harassing you over your debts? If every time the phone rings you cringe, if you lose sleep worrying about debt collectors, bankruptcy can stop the harassment. If a creditor is suing you, your debt may be increased by the amount of creditor's attorney's fees and court costs. Once the creditor obtains a judgment, then a process server, such as a sheriff, marshal or constable, may have court approval to garnish your pay, your bank account, or seize and sell your property to satisfy the judgment. Bankruptcy can stop that, but it must be done in time to prevent the seizure.
Borrowing from friends and family
Do you have to borrow from friends and relatives just to pay your monthly expenses? You're just making people who you care about your creditors, which is a good way to damage your relationships. Bankruptcy can help you get in control of your finances so you can avoid or at least minimize family borrowing.
Delinquent house or vehicle payments
Are you falling behind on house or car payments? If so, home foreclosure or repossession can't be far behind. While bankruptcy does not discharge a mortgage or secured vehicle lien, it can allow you ways to manage them, give you some breathing space before you have to resume payments, or eliminate your liability for a deficiency if you surrender these assets.
Credit card overload
Do you barely get by every month, and still only pay the interest on your credit cards. If you have insufficient income to reduce your credit card debts, you should consider how bankruptcy can get you a fresh financial start now, free of any of these credit card debts, so that you can begin replenishing your savings, and building for the future, instead of treading water in a sea of red ink. As a rule of thumb, if your credit card debts exceed four months of gross income, you are probably in debtor over your head.
Is the IRS or some other agency attempting to garnish your paycheck? It only gets worse from here. While the garnishment is in effect you'll not have enough disposable income to pay your other creditors, who may sue you and effect another wage garnishment, leading to a dominoe effect. Bankruptcy can stop wage garnishments in their tracks, allowing you to pay your household expenses from your current income.
Severe anxiety or stress
Life can be stressful. However, there are times when financial problems can make it seem that life is not worth living! If you have suicidial thoughts, are depressed, have panic attacks or anxiety because of creditors, bankruptcy can provide the best solution for these severe problems. Life after bankruptcy is not all beans and stale bread. You may have limited access to credit, but credit is only the ability to get back into debt.
Additional resources provided by the author
If you have one or more of these warning signs happening in your life, consult with a bankruptcy attorney