You can wait too long to file bankruptcy and lose property you might have saved. Blogger Susanne Robicsek says people should seek the last resort of bankruptcy earlier.
“Traditionally bankruptcy has been known as a last resort, but that is no longer good advice. For many people, bankruptcy is a better choice than sinking further and further into debt, exhausting their savings and retirement plans, putting their homes at risk, or dragging their families into their financial mess,” Robicsek says.
Here are six signs you may have waited too long to see a bankruptcy attorney:
- Your home has been sold or is about to be sold at foreclosure sale.
- Your car just got repossessed by the lender.
- Your paycheck or bank account is being garnished.
- The IRS has filed a tax lien on your property.
- Your paycheck is taken by payday lenders.
- You are depleting your retirement account to pay general debts with no collateral such as credit cards and medical bills.
Bankruptcy is about protecting your property from creditors. Waiting until you are out of time and money may reduce the help you can get from bankruptcy. A last minute decision to file will limit your options.
It may be impossible to reverse these collection actions and get your property back. The old saying that possession is nine-tenths of the law has a ring of truth to it.
You can may be able to cure the arrearage on your home loan and reinstate your mortgage in chapter 13 bankruptcy, but most state laws say it is too late to do so after foreclosure sale. Get to a bankruptcy attorney who files chapter 13 payment plan bankruptcies ASAP if you want to save your home this way.
If your car has been repossessed, it might be possible to get it back and pay for it in chapter 13 bankruptcy, but you will have to act quickly. Kansas law has a 10 day deadline from the day of the seizure. The creditor has the upperhand. You may have to pay for the tow truck, storage fees, attorneys fees and six months of insurance. It is far better to file your chapter 13 payment plan bankruptcy BEFORE the car is seized.
Once your wages or bank account are garnished by a creditor, your cash flow is severely reduced or cutoff altogether. You can’t pay your bills or feed your family. Waiting to file bankruptcy until garnishment happens, makes for a big hole to climb out of. You may not get your money back even if you file, but bankruptcy can stop garnishment.
An lien by the Internal Revenue Service attaches to all your property. The IRS can seize almost everything you own. A bankruptcy stops the IRS from filing a lien. You can repay the taxes you owe in a chapter 13 bankruptcy. If a lien is filed first, you will have to pay back more taxes, penalties and interest on the tax claim.
Payday loans are like quicksand. Once you authorize a payday lender to take funds from your bank account, you end up with little or no paycheck and often find yourself borrowing again and again to pay one payday loan with another payday loan. Stop the merry-go-round with bankruptcy.
Cashing in your retirement fund to pay debts might “work” temporarily, but the funds run out and you pay a tremendous price. You may forfeit 30-50% of your withdrawal to taxes. You will be swapping debts you could get rid of in bankruptcy for tax debt you will have to pay. Worse yet, you will be borrowing from your future.
Seek the advice of a bankruptcy attorney before it is too late. Bankruptcy is not a last resort.
Image: Caboose PSF courtesy of Wikimedia
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Thanks for some quality points there. I am kind of new to online , so I printed this off to put in my file, any better way to go about keeping track of it then printing?