Whenever a person is experiencing severe financial problems, he or she might wonder whether to file for bankruptcy. Determining whether or not to file is not an easy decision for most people, as there are consequences of filing, but you might be able to find the answer to this question by analyzing the following three questions.
How Much Will It Cost to File?
The first thing you might want to evaluate is the costs of filing for bankruptcy. When you file, you must pay legal fees to your lawyer and filing fees for the court. This can add up to well over $1,000, and it can sometimes cost a lot more than this. The amount you will pay for the fees will depend on the branch you use, the complication of your case, and the amount your lawyer charges. The amount you must pay is something you can find out by meeting with a lawyer.
How Will It Benefit You?
The second question to find out is how filing for bankruptcy would benefit you. The main benefit people look for in bankruptcy is relief from debt. If you are able to use Chapter 7, you will probably be able to get some, or all, of your debts forgiven. If you file for Chapter 13, you would have to pay back a lot of your debts. As you analyze your situation, find out exactly how it would work with your situation, and the best way to find this out is by talking to a lawyer about it. A lawyer can often tell a person what relief they will get just by taking a good look at the person's income and debts.
What Consequences Will You Face?
The final question to ask relates to the consequences of filing for bankruptcy. One consequence people face with Chapter 7 is a loss of assets. If you have money in the bank, for example, you could lose it if you use this branch. A second consequence is negativity on your credit report. A bankruptcy posting on your credit report will remain there for up to a decade, depending on the branch you use, and this could impact your ability to get loans and credit during the next few years.
If you would like to know more about bankruptcy and your options so you can make a good decision about filing, talk to a bankruptcy attorney in your area about your personal situation.