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How to know when to file for Chapter 7 bankruptcy

On Behalf of | Oct 30, 2020 | Chapter 7 Bankruptcy

Making ends meet these days can be a challenge to say the least. Many Florida residents find that they just can’t do it and become overwhelmed with debt. Imagine if there was a way to make debt magically disappear like erasing a chalkboard. Although it’s not quite that simple, filing for Chapter 7 bankruptcy is a way to eliminate overwhelming debt when there seems to be no way out. But, how does one know when it’s time to seek bankruptcy protection?

Chapter 7 bankruptcy is often referred to as a straight bankruptcy and is the most common type of bankruptcy filing in the United States, with thousands of citizens filing every year. In short, Chapter 7 bankruptcy will liquidate assets to pay off as much debt as possible. A few reasons why many people file for bankruptcy include losing employment, overwhelming consumer debt or large medical expenses.

In order to know if filing for bankruptcy is the right move, it is helpful to assess the financial situation. Here are a few signs that it may be necessary to seek Chapter 7 bankruptcy.

  • Being unsure of how much is actually owed.
  • Only making minimum payments on credit cards.
  • Receiving calls from bill collectors.
  • Using only credit cards to pay for necessities.
  • Finances have become uncontrollable or unmanageable.

Also, collect and add up credit statements and bills. If the value of assets is less than the debt owed, declaring bankruptcy may be the way out of a seemingly hopeless financial situation.

Obviously, hearing the word “bankruptcy” doesn’t bring about a good feeling. However, for those who feel as if they are drowning underneath a load of debt, it may be time to face the facts and consider Chapter 7 bankruptcy. It is recommended to consult a lawyer before proceeding with bankruptcy. An experienced bankruptcy attorney can help Florida residents figure out the best fit for their individual circumstances.

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