When any person is finding it difficult to make ends meet and has a huge debt piling on, there are two options available for them; either opt for bankruptcy or for a debt repayment plan. People in difficult financial situations should make it a point to consult either a financial counselor or a bankruptcy attorney to find the best possible way to get out of their financial mess. According to lawyers of Los Angeles based bankruptcy law firm Recovery Law Group , the various factors to consider to decide which option will work for the client include:
- Your income and debts
The primary consideration is what is the amount of debts that you owe and if you have enough income to pay them back. In case our income is not enough to pay back your debts, bankruptcy will be the best option. However, if you can make a decent amount of money and can pay back your debts, then you need to find out alternate ways to get rid of debts.
- Your assets
Many times, there is a crunch of free cash which results in a person being in debt. However, if you have several assets, filing for bankruptcy will result in selling off non-exempt property to clear your debts. You could, alternately, do this (sell your assets) on your own without filing for bankruptcy and get rid of your debts.
- Types of debts
Certain debts like secured debts (car loan, house mortgage) cannot be discharged. Similarly, unsecured priority debts like a student loan or certain government taxes won’t be discharged during bankruptcy. If these kinds of loans constitute your major debt, filing for bankruptcy is futile. However, if the major portion of your loans comprises of credit card debts, personal loan, medical bills, etc. then bankruptcy is ideal for you.
If you are considering bankruptcy to get rid of your debts, then you might need to consult bankruptcy lawyers regarding various aspects of bankruptcy. You can call 888-297-6023 to schedule an appointment for a consultation.