Bankruptcy - When is it a good choice? Part 2

It is not a simple decision to file for debt relief; there are long-term things to think about, including the fact that the bankruptcy will stay on your credit report for 10 years. Once you file for debt relief in court, you will not be able to have your debts forgiven again for eight years after filing. With the new bankruptcy legislation in place, millions of Americans are justifiably concerned about whether they should file for bankruptcy, or court-ordered debt relief.

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Here we will look at a few tips than may help you determine if you should file for bankruptcy.

• You are applying for extra credit cards because you have no space on your existing ones. Obtaining additional bank cards won't make your situation better; it will make it worse. Ultimately, a new bank card only means one more bill that you can't pay. If your charge cards are full or "maxed out" you don't need more credit cards, you need to pay your bills.
• You are being sued for failing to pay. Lawsuits are always a last resort for them after they've called and badgered and pleaded you for the debt you owe them. A lawsuit is a fairly clear sign of a problem. If you have arrived at a point where you are being sued, and you can't do anything about paying the bill, then it's almost certainly time to consider filing for bankruptcy. Financial institutions don't care to sue their borrowers; it takes time and costs lots of money.

• Are you working overtime to pay your bills? If you have more debt every month than you can pay with your typical, non-overtime paycheck, you may have trouble. You will not always be able to count on overtime, and besides, who wants to work extra all the time? Life is too short to work yourself too much. We don't refer to the every-now-and-again overtime to pay the holiday present expenses; we are talking about expecting extra hours each and every week because you cannot pay the rent or the car loan without working extra. Having to work overtime to pay your regular bills is a sure sign of trouble.
• Are you making your payments for food or groceries with your credit cards? We don't refer to the every-now-and-again dinner out at the Italian place; we are discussing loading cars full of groceries at Albertson's and paying by credit card because you don't have the funds in your bank account. Food is a regular expense; you should have funds from your salary to cover it. If you don't have cash in the bank, and you're paying with a bank card at twenty percent per year, you have a serious problem.

If you find anything in the above scenarios that fits you then you more than likely should think about at least meeting with a law firm who specializes in debt relief law. These are just suggestions, and not set rules. It can't hurt to talk to a bankruptcy professional if you are in financial trouble, but doing it sooner instead of later would be a good start. The longer you wait, the worse your situation might become.