investments that can drive you bankrupt

If you are behind on your mortgage payments, are being harassed by creditors, or are facing foreclosure, then you are experiencing a massive financial crisis. If liquidating your assets will not help your situation, then you should consider filing for bankruptcy. 

Bankruptcy can eliminate or reduce your debts and save your home from foreclosure. Consult your bankruptcy attorney to advise you about your bankruptcy options. Here are some signs that you should file for bankruptcy. 

Loss of Employment

One of the reasons to consider filing for bankruptcy is job loss. Although some people have an emergency fund or receive a severance package, many people who lose employment don't have these backup sources of income.

Furthermore, the cost of insurance can take a toll on a jobless person's limited financial resources. Also, if you remain unemployed for a long time and start falling behind on bills, you should seek out a bankruptcy attorney to help you choose the appropriate bankruptcy option.

High-Interest Rates

If you have a lot of debt, getting a loan can be difficult. If you are lucky, you will get loans with high-interest rates. Therefore, you will pay more for the money you borrow than you would with a good credit score. If you find it expensive or impossible to borrow money, you can file for bankruptcy.

Creditor Lawsuit

If your creditor files a lawsuit because of your unpaid debts, you should consider filing for bankruptcy. This will help stop legal action against you. An automatic stay is triggered when you file for bankruptcy to stop creditors from pestering you. While this isn't a permanent solution, it allows you to review your options and create a repayment plan. 

Home Foreclosure

Sometimes, people file for bankruptcy to protect their homes from foreclosure. Whenever you declare bankruptcy, the court will order financial institutions to desist from taking action against you.

You can either file Chapter 7 or Chapter 13 bankruptcy to stop foreclosure. A temporary stay will ensue from Chapter 7. This will give you time to reorganize your finances. If you cannot clear your payments, foreclosure can still happen. However, with Chapter 13 bankruptcy, you have a chance to agree on a repayment plan with your creditors and catch up on late payments.

In Closing

Before you think of filing for bankruptcy, review your financial status. Think about how you expect bankruptcy to help you with your debts, bills, and financial obligations. Most importantly, hire a bankruptcy attorney to help you find the best bankruptcy plan for your situation.

Contact a local bankruptcy lawyer to learn more.