By: Darrell Castle
Different people file for bankruptcy for different reasons.
You may be struggling financially from factors out of your control. Or maybe you just made some bad spending decisions and now you’re — for lack of a better term — paying the price.
Whatever your situation is, I can assure you that you’re not alone. American consumers owe $11.91 trillion in debt.
A bankruptcy is a great option — and often times the best option — if you’re struggling with debt you just can’t pay. Here are some of the top reasons people choose to file for bankruptcy:
1. Medical bills
Expensive doctors plus insufficient insurance equals a financial mess. If you or someone in your family suddenly gets sick, needs surgery or treatment and has to spend time in the hospital, you can expect to pay a fortune in medical bills. This is a discouraging reality for many people. Approximately 35% of the US population says they were stuck paying medical debt in the past year. I’ll talk more about medical debt in #6 and #9.
2. Job loss
A sudden job loss can really throw everything off. Especially your finances if you didn’t have enough money stored away in an emergency fund. The income stops coming in but the bills don’t and you can quickly fall behind. A bankruptcy can help you wipe away that debt.
3. Behind on mortgage payment
Average mortgage debt in the US is $156,706. You can fall behind on your mortgage for different reasons. Maybe your income changed. Maybe another expense reared its ugly head and money got tight. Or maybe you fell behind on another bill and had to make ends meet somehow, even if that meant neglecting your mortgage. We see these situations very often in our office. I talk more about it in #7 and #9.
4. Behind on car payment
You can fall behind on your car payment just like you can your mortgage. And with high interest rates, when you begin missing payments the bill can multiply and get out of hand very quickly. I talk more about this in #8 and #9.
5. Behind on credit card bills
Average credit card debt in the US is $15,609. People use credit cards irresponsibly. It’s so easy to swipe a card to make a purchase, completely expanding your standard of living past what your bank account allows. But it can come back to bite you when those high interest rates kick in and you lose control. I talk more about this is #6 and #9.
6. Stop a wage garnishment
When you fall behind on unsecured debt like credit card or medical bills, the creditors don’t have property they can come and take from you in return. But they can file a lawsuit on your debt to garnish your wages. And this is a MESS to deal with that will end up costing you a lot more than just the original debt you owe. You can stop the wage garnishment through a bankruptcy. And it’s best to do so before it begins.
7. Stop a foreclosure
As mentioned above, you can fall behind on your mortgage for various reasons. Your mortgage is a secured debt, meaning it’s a debt backed by collateral. That collateral is your house. So when you don’t make your payments on your house, the bank has the right to come and take it from you. You can stop a foreclosure through a bankruptcy and keep your home though.
8. Stop a car repossession
Just like with your mortgage, your car payment is a secured debt. When you fail to make your car payments, the bank can come and take it from you. The repo man is sneaky too. This isn’t something you want to deal with, especially if your car is your main source to and from work. You can stop a car repossession through a bankruptcy and keep your vehicle.
9. Stop creditor harassment
If you fall behind on ANY bills — including any of the ones mentioned above — then you’re subject to potential creditor harassment. Creditors will call you at all times of the day and night. They’ll call you when you wake up and they’ll even wake you up! They’ll call you when you’re getting ready for work in the morning or when you’re actually at work. They’ll call you when you’re trying to relax and enjoy family time. They’re annoying. And you can stop this creditor harassment by filing for bankruptcy.
Want a FREE bankruptcy consultation?
The bankruptcy attorneys at Darrell Castle & Associates want to help you get out of debt. We’re good at it too. Click here to read what some of our past clients have to say about their experience with us.
Call (901) 327-2100 today to schedule your FREE consultation.