Am I a Good Candidate For Bankruptcy?

by Gary Foreman, Editor of The Dollar Stretcher.com


Our purpose with this post is not to qualify you for bankruptcy. Our goal is to help you decide whether it would be a good idea to contact a counselor that can help you make a final decision. Let's look at some bankruptcy facts and then you can decide whether filing for bankruptcy could be a good solution to your debt problem.

Bankruptcy

Bankruptcy protection does offer some advantages.

Among them are:
- you'll eliminate your credit card balances
- you'll eliminate any medical bills
- you can stop a foreclosure on your home
- you can stop wage garnishment
- collection calls will be stopped

Some of your possessions are protected in bankruptcy. That means the creditors can't take them from you. They include your home, car, furniture and wages.

It's important to remember that all of your bills are not automatically included in the bankruptcy filing. You can choose to exclude certain bills and continue to pay them. You also run the risk of overlooking bills that you wanted to include in the bankruptcy but didn't.

There are some debts that will not be discharged in bankruptcy.

They include:
- Most taxes
- Child support
- Alimony
- Most student loans
- Court fines and money owed due to criminal offenses
- Money owed others due to personal injury caused by driving under the influence of drugs or drink

Are you a good candidate for bankruptcy?

Consider these items:

Good Candidate for Bankruptcy:
- your debts would take more than 5 years to repay
- you cannot meet all your commitments on your present income
- you have assets you want to protect from creditors - like your home
- your creditors are threatening or have started taking legal action to collect
- dealing with your debts is having a negative effect on your emotions or effecting your relationship with your spouse

Bad Candidate for Bankruptcy:
- you can pay off your debts in 5 years or less
- it could affect your job. It is illegal to fire someone for declaring bankruptcy, but some companies will check your credit score if you apply for a job with them
- you'll have trouble getting over feeling like a failure if you file for bankruptcy
- some or many of your debts cannot be discharged in bankruptcy

If you think that you may be a good candidate for bankruptcy contact a debt counselor. They'll be able to get your specifics and recommend a course of action. TDS recommends the professionals at Debt.com. You can contact them using the form below. Or you can find out more about why we recommend them.


If you have significant debts, but feel that filing for bankruptcy clearly isn't for you, then you might want to consider credit counseling as an alternative. TDS recommends that you contact the Financial Counseling Association of America (FCAA) to find a trust-worthy counselor. Their standards ensure that consumers with problem debt will receive expert help from experienced organizations they can trust.


If you don't have significant debts, but are reading this for a friend or relative, please send them this information so they can read it for themselves!

If you are working to get out of debt, our free weekly Surviving Tough Times newsletter can be a great tool. Each issue features great ways to help you stretch your dollars and make the most of your resources. Subscribe today! You can also like us on Facebook or follow us on Twitter. We post tips and ideas daily to help you make extra cash and trim monthly expenses so you can free up additional money to put towards your debt.

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