Do People Wait Too Long to File?
Everyone has a point of no return or tipping point, when you know you’ll never be able to pay off your debts. Once you pass that point, the only way to get out of debt is to file for bankruptcy. The problem is, no one wants to file for bankruptcy, so often, even after they’ve passed the tipping point, they’ll put it off as long as possible, often waiting until they’re up against foreclosure, repossession, or garnishment before taking action, hoping that someday something will happen to get them ahead.
However, unless you know your income will increase $300,000 in the next 10 years, that’s probably not going to happen, and you may never catch up and pay your debts. Once your credit card debt to more than 30% of your annual income, you’re probably in trouble. For people who make between $30,000 and $50,000 a year who have $10,000-$20,000 in credit card debt, it will be nearly impossible for them to ever pay off that debt, especially if they have a family and kids.
Waiting doesn’t make things better because the interest rate keeps increasing and the snowball just keeps getting bigger and bigger, which means the collection calls and harassment gets worse. Again, people tell me over and over again, “I wish I’d just done this sooner.”
How Do I Know I have the Right Attorney for the Job?
Finding the right attorney for your bankruptcy involves doing some basic research. The main thing to look at is how much information the lawyer is willing to give you, whether they have a lot of information at their website and whether they can provide you with plenty of information without pressuring you to make a decision. Many lawyers don’t want to share information; they just want you to come in and sign up, but the amount of information you can get is very important.
The best thing to do is to call and either make an appointment or get an information packet from the lawyer and review it at home. You can also go in and speak to the face-to-face and get the information you need to make a best decision.
Also, find out how long the attorney’s been practicing, what areas of law they practice in and how many cases like yours they have handled. Don’t be afraid to ask what can go wrong and how much everything will cost early on.
What Information Should I Provide to My Attorney?
Your attorney will need to see your tax returns, pay stubs, bank statements and any bills you have, because they will have to assess your financial situation to be able to see how they can help you. Obviously, the more organized and more complete your information is, the better the answers you will get from the attorney.
If I Come in Tomorrow, How Soon Can We Get this Going?
We do a lot of emergency filings, in which we file within 24 hours of the client coming in to see us. That can be done very quickly if there’s an emergency and a need to file. In other cases, there are reasons you might want to wait; for example, if you have tax debt that’s about to become more than 3 years old, you might want to wait before you file. Likewise, if your income is about to go up or down significantly, you might want to wait; filing immediately might not always be the best solution, which is why you should speak to an experienced attorney,
Once I Choose to File, Are there Any Mistakes to Stay Away From?
If you file a Chapter 7 and wipe out all your debts and get a fresh start, you should avoid getting back into debt, since you can only file Chapter 7 once every 8 years. If you pile up your debt again too fast, it will take years to get more relief. After you file, set up a budget and try to live within your means.