If you are currently unable to continue making payments on large debts, it is important that you take appropriate action to remedy the problem in a way that will cause the least long-term damage to your credit while still alleviating some of the burden. If you are considering bankruptcy, consult a professional before moving forward.
Our bankruptcy lawyers at Dethlefs Pykosh & Murphy Law are here to serve you and help you weigh all of your options. With an experienced attorney at your side, you are more likely to make good decisions regarding debt repayment options and avoid many of the major pitfalls of attempting to resolve your debts alone (such as rushing into bankruptcy).
Before proceeding, call (717) 975-9446 today to schedule your first meeting with a legal advisor.
Short-Term Financial Crises
Before reading further, it is critical to understand that a short-term lapse in income or a temporary financial crisis does not typically warrant such extreme actions as filing for bankruptcy. If you are experiencing a personal or financial dilemma such as unemployment, severe injury, short-term disability, or any other health emergency, you may be able to temporarily reduce payments or be approved for a brief abeyance.
Alternatives to Bankruptcy
Bankruptcy is financially devastating, no matter how you slice it. Depending on the chapter you file under, you could experience reduced credit scores, high interest rates, and continued financial challenges for more than a decade. As such, bankruptcy is to be avoided unless it is absolutely necessary. If you are not sure if bankruptcy is right for you, consider the following alternatives:
- Negotiation with creditors and lenders
- Receive credit counseling and professional assistance with repayment plans, budgeting, etc.
- Doing nothing at all (You read that right—If you do not have much income or property, there may not be much a creditor could legally confiscate, nor can you be imprisoned or legally punished for failure to repay debts, unless they are tax or support-related debts.)
Long-Term Financial Hardship and Eligibility for Bankruptcy
While there are alternatives to filing for bankruptcy, sometimes it is warranted. If you will be unable to continue paying down your debts for the foreseeable future, you may need to restructure your debts and have some of them dismissed. Bankruptcy may provide a path forward if any of the following apply:
- Your inability to repay your debts poses a threat to your important assets, such as your home, automobiles, etc.
- Some of your debts are unsecured, such as credit card debts and personal loans.
- Your income is less than the average income in your area.
- The sum of your monthly payments is more than your income or does not leave enough discretionary income to afford the cost of living or basic expenses for you and any dependents.
- You have made a considerable effort to repay your debts and keep up with monthly payments.
- Your income is unlikely to increase in the foreseeable future.
Considering Filing for Bankruptcy in Harrisburg, PA? Connect with an Experienced Bankruptcy Lawyer Immediately.
If you think bankruptcy may be the right option for you, it is important to secure the right legal representation. If you still aren’t sure, it’s just as important to speak with an attorney before moving forward. Our legal team has served many clients in the Harrisburg and York areas who have been in your shoes, and we are well equipped to help you evaluate your options and take the best route to debt relief.