When a potential client comes into my office, my objective is to get a complete picture of their financial situation and give them my opinion about what their best option is. Sometimes bankruptcy isn’t something I recommend.
If a potential client tells me any of the following things are happening, I tell them I think they should consider bankruptcy to help them get things in order:
- They are falling behind in payments to some secured or unsecured creditors
- They are getting phone calls from debt collectors
- They have little or no savings and no health insurance
- They have been out of work for one month or more
If a a potential client tells me any of the following things are happening, I tell them I think they should strongly consider bankruptcy:
- They are more than 60 days behind paying one bill
- Use new credit cards to pay the minimums on other credit cards
- They have pending lawsuits against them
- They can’t pay off unsecured debts in full within five years
- They owe big medical bills or back taxes they can’t pay
- They have been out of work for three months or more
If a potential client tells me any of the following things are happening, I tell them I think they should file bankruptcy immediately:
- They have unsecured and secured debts that can’t be paid
- Their wages have been garnished
- Their bank account has been garnished
- Their car has been repossessed
- Their home is set for foreclosure
- Their unemployment benefits have run out
As I always tell my potential clients during their consultation, “Bankruptcy shouldn’t be your first option, but sometimes it’s your best option.”