Most Americans have debt, but you don’t see everyone filing for bankruptcy. Debt has become a way of life, and many creditors are willing to work with individuals who are having a hard time paying off their debts. If you have debt, bankruptcy is not always the answer, but it could be your best option in certain situations. 

You Have a Significant Amount of Debt

Some people have a home loan and that’s the extent of their debt. Others have multiple credit cards, medical debt, personal loans, car loans and other debt on top of that mortgage. If your debt totals a few thousand dollars, it would be easy to sell a few things to get that debt paid. If your debt totals a few hundred thousand dollars, it might be harder to pay it back. That much debt and more could be considered a significant amount of debt, and depending on your situation, it might warrant filing for bankruptcy.

You Have No Way To Pay Your Creditors

When the economy isn’t doing well, many individuals who have debt are those who suffer most. Not only do you have your regular expenses, but your debt expenses as well. If you lost your job, are unable to work due to injury or are in a similarly difficult situation, you might not have a way to pay your creditors. It could benefit you to file for bankruptcy if your creditors have started to harass you.

Your Credit Score Is Plummeting

Your credit score is a combination of factors that include what debts you have, how much you owe, how good you are at paying it back and whether you make your payments on time. When you are unable to make your payments, it is going to hurt your credit score. If you have noticed a trend in which your score is plummeting, you might seek bankruptcy as a way to improve the score. It is going to take some time for that score to get back up, but it is possible.

If you’re considering bankruptcy as a solution to your financial woes, you might want to speak with a lawyer first so you understand all of your options. There’s a chance the lawyer will agree that you should file bankruptcy and there’s a chance he or she will recommend another route. In either case, getting a bankruptcy lawyer on the case could be beneficial. Get started today by contacting a legal professional, such as a lawyer for how bankruptcy affects tax debts from The Law Offices of Marty D. Martin.