If you are in serious debt, you may be getting advice from friends and family to consider filing bankrutpcy. However, the question remains what really happens if you do not take that step.
The first consideration should be whether you are Judgment Proof. Judgment Proof means you have no assets that the creditors could take to satisfy your debt, such as a house or car. Some examples would be if you are disabled and your only form of income is through disability insurance or Social Security, or you have little money and you are renting an apartment.
If you do have assets, delaying bankruptcy or even delaying the option of investigating bankruptcy may create problems. Falling behind on payments can create an environment where a bank will foreclose on your house before you can take protective action through bankruptcy. You do not want to wait beyond the point-of-no-return.
A creditor that does not receive payments from you can, and will, sue to collect their money. The creditor will go to court and seek a judgment to seize your assets or garnish your wages to satisfy the judgment. If you have acted in time and your creditors have not yet sued you, they cannot attach your assets or garnish your wages to extinguish your debt. You cannot be jailed for non-payment and you cannot be forced to pay money that you do not have.
The best way to assess your situation is to do a simple self-assessment of your income and expenses. If you can find a way to pay your bills and continue to support yourself and family, then you may need to consider other options. However if you find that the money is just not there, then you may find that bankruptcy is the best and only avenue to a fresh start.
The next step would be to determine if you qualifying under the ‘Means Test‘ for a Chapter 7 or qualifying for payment plans to creditors under a Chapter 13.
At the Law Offices of Dominick Rendina we are ready to assist you in determining the option that best meets your needs and satisfies your comfort level and provide you with a new path to move on with your life.
We are a federally designated Debt Relief Agency as defined in the 2005 amendments to the US Bankruptcy Code. This law firm provides legal advice regarding the filing of bankruptcy and represents individuals and businesses in filing for bankruptcy relief under the US Bankruptcy Code.
Information in this post should be confirmed through an attorney and is for informational purposes only.