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How do I know if I should declare bankruptcy or not? | On your debt

Take an honest look at your current situation. Write down all of your day-to-day expenses such as rent, food, clothing, medicine, insurance premiums, utility bills, vehicle-related expenses (such as maintenance and gas), hobbies and all your other regular monthly expenses. Next, write down all of your monthly debt payments each month, such as your mortgage payments, car bills, credit card bills, and other installment payments on your debt. With your current income, are you able to pay your living expenses and debts each month? Or do you go in the hole every month and “steal Peter to pay Paul?”

If you “rob Peter to pay Paul”, is this probably a temporary situation? For example, have you (or your spouse) recently lost a job or suffered some other loss of income? If so, how quickly do you think you can replace that lost income? Can you cut expenses in some way to make up for lost revenue? Is your concern due to an unexpected increase in your expenses? Do you have enough savings or other resources to offset lost income or cover unforeseen expenses? If so, it may be best to use these resources to help you through the temporary crisis.

Be very careful when borrowing more money to fix your situation. For example, if you’re a homeowner, you might think it’s a good idea to borrow against the equity in your home to pay off your credit card debt. That might sound good because the interest rate on a home equity loan will almost certainly be significantly lower than on a credit card, giving you big savings. But by doing this, you are converting credit card debt into mortgage debt. If your situation continues to improve, this is unlikely to be a problem. However, if your situation does not improve, you are worse off than you would have been had you avoided the home equity loan in the first place. Why? Because the mortgage debt you created is secured by collateral, which is your home. The credit card debt you paid off was general unsecured debt. General unsecured debt is the easiest type of debt to adjust or completely eliminate if you need to file for Chapter 7 bankruptcy or Chapter 13 debt consolidation.

If it seems that your situation is more than a temporary situation or if you do not have sufficient resources to get out of it, it is time to consult us. Don’t wait for something bad to happen or about to happen. A delay in these situations usually means fewer options and possible loss of property. We are experienced debt relief attorneys and will review all of your options with you and help you determine if you really need to seek legal debt relief in the form of a Chapter 7 or Chapter 13 case. Sometimes , other options are available to you for

Avoid filing an official debt relief case and these options can also be discussed. Our lawyers will meet with you free of charge to assess your situation and discuss all your options with you. After this consultation, you can decide what course of action, if any, you wish to take. If you have any questions or concerns about this, I invite you to contact our office.

Bond & Botes helps people struggling with debt

We are local and offer a free, confidential face-to-face consultation with an experienced attorney. We also offer free consultations in the comfort and safety of your home or office by phone and/or video if you wish. Let us solve your financial problems. There’s no obligation, and that means there’s no downside to gathering the information you need to make good decisions about how to break the cycle of debt stress and go forward. We can answer all of your questions regarding Chapter 7 bankruptcy, Chapter 13 bankruptcy, stopping a foreclosure or wage garnishment, avoiding liens, stopping a lawsuit, l medical debt, personal loans, payday loans, credit card debt, etc. We can relieve your stress! We want to help you and we can help you!

The State Bar of Alabama requires the following: “No representation is made that the quality of legal services to be provided is superior to the quality of legal services provided by other attorneys.


Bond, Botes, Sykstus, Tanner & McNutt, PC

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No representation is made that the quality of legal services to be provided is superior to the quality of legal services to be provided by other attorneys.