Often people are reluctant to file for bankruptcy because they have the belief that they are not the type of person who should file for bankruptcy.  In fact, some people think that filing for bankruptcy is reserved for someone else’s situation and not their own. For example, one widely held belief is that bankruptcy is for only people who have uncontrollable spending problems. Oddly enough, there is no one particular reason why people file for bankruptcy, and, people of all types pursue bankruptcy actions. Specifically, the government created bankruptcy as a way to allow people to have a fresh financial start—and, many avail themselves of this option as a result.  Here are some of the top reasons that have led people to file for bankruptcy:

  • Divorce: Not only can financial problems lead to divorce, the opposite is also true. A long drawn out divorce can lead to costly attorney fees and as such, drain the assets of a divorcing couple. There are also the financial challenges of providing for a household on only one income, one the divorce is effectuated.
  • Halting Foreclosure Proceedings: For debtors who have fallen behind on their mortgage payments and find themselves facing foreclosure proceedings, bankruptcy may provide them with immediate financial relief.  The automatic stay power of the bankruptcy halts the foreclosure process and allows a debtor to catch up on missed payments by possibly eliminating unsecured debt, such as credit card debt, which provides more cash for the debtor.
  • Job Loss: In difficult economic times, people who lose their job due to downsizing or layoffs often find that it takes longer to land a new job than previously thought. Meanwhile, savings and checking account balances dwindle away as a result. The debtor is then unable to make mortgage payments and must resort to living off of credit cards.
  • Medical Expenses: Medical bills can grow at an alarming rate if a debtor becomes seriously injured or ill and is without medical insurance or underinsured. For some people, one trip to the emergency room creates such an enormous expense that the debt may take more than 20 years to pay off.
  • Stop Wage Garnishment/Collection Proceedings:  The automatic stay temporarily stops creditors from collecting on any debts, including wage garnishments.   It also stops repossession of a vehicle due to missed payments.
  • Student Loan Consolidation: Although bankruptcy in most instances cannot eliminate student loans, the process allows for loans payments to be consolidated. This can make a big financial difference for some debtors facing this type of debt.
  • Tragic Accidents and Disasters: It is difficult to plan for or ever be completely financially prepared for the unexpected.  Specifically, tragic accidents such as a catastrophic injury due to a motor vehicle accident or loss of a home due to a natural disaster, can lead to serious financial ruin, making bankruptcy a helpful option.
  • Weak Financial Planning: For some people, filing for bankruptcy is result of weak financial planning.

If you are looking for a fresh financial start, contact my office today at 913-742-8700 to schedule a free consultation. I will take the time necessary to thoroughly review your financial situation and help you find the best solution possible to put you on the path towards financial freedom. You deserve the opportunity to put your debt behind you and begin anew.