Many people knee deep in debt don’t see the warning signs of impending financial doom until it’s too late. Still others will do anything to avoid filing bankruptcy, only to find that bankruptcy was their best option all along. At The Law Offices of R.J.Atkinson, we have helped thousands in Texas eliminate, reduce, and reorganize their debts through bankruptcy. People who need debt relief the most, will often deny having any debt problems at all. It’s easy to not see a situation clearly when you are in the middle of it. If you have debt problems, or if any of the following warning signs are familiar to you, then you may want to contact us for a free bankruptcy evaluation.
Don’t Ignore the Bankruptcy Warning Signs…
If you have overwhelming debt, the following are some of the warning signs that you might want to consider bankruptcy.
- 1. You have stacks of unopened bills.
Many people with mounting or overwhelming debt simply don’t open their mail. They literally let their bills pile up. When bills pile up they continue to add up. Credit card companies, collection agencies, and medical collectors will often send various notices when you are past due or delinquent. These bills seen through a windowed envelope may change color as time goes by, from white to yellow, to orange to pink, and back again. Whatever color they change to, if you are familiar with this phenomenon and your mail remains unopened you may be heading for trouble. If you have stacks of unopened mail and are weary of opening it, then you might consider your options in bankruptcy.
- 2. You are not certain as to how much money you owe.
If your debts can’t be determined within a few thousand dollars then you may have more problems than you think. Most people don’t know how much money they owe down to the penny or dollar, but managing your debt or at least having an idea within 1 to 2 thousand dollars is better than plain old generalities. More specifically, we’re talking about the person who believes they owe “about” $25,000.00 or “say” $30,000.00 “or so”. It’s often these people who end up in the office for a free initial consultation who say about what they owe, but when it gets put to paper, and their credit reports are pulled, they oftentimes owe double plus what they guesstimated.
In addition to the individual cases we’ve seen who aren’t sure of the magnitude of their debt, there are the married couples that don’t know the extent of their spouse’s debt. You may have heard the phrase “the right hand doesn’t know what the left hand is doing”. With married couples, it isn’t uncommon to have one spouse really not know what the other spouse’s debt is. Not communicating with each other or knowing what your spouse owes can hit you when you least expect it. It’s certainly not our place to tell married couples how to communicate with each other, but not knowing the financial obligations or your spouse can have a negative effect on your financial future if you don’t communicate, and may be a sign to consider bankruptcy.
- 3. You borrow from one creditor to pay another.
You have probably heard the saying “Robbing Peter to pay Paul”. If you are robbing Peter to pay Paul, or getting a cash advance from one credit card to pay another credit card, then you may be a candidate for bankruptcy. Whatever you call it, incurring debt to stave off other debt generally isn’t good financially. The cycle of borrowing from one creditor to pay another is an escalation to a potentially bad credit crash. Eventually, borrowing more and more will take its toll and backfire on you. Borrowing like this only incurs more debt.
Now despite the fact that credit cards companies make it easy to transfer balances, get cash advances, or send checks which seem like cash, you are just digging and digging a deeper hole of debt. If you do end up filing for bankruptcy, these same credit card companies who once enticed you to transfer balances, or rob Peter to pay Paul, may cry fraud or try to make a case that you never intended to pay their debts since you were insolvent, and had no money when you made the charges.
If you are borrowing from one creditor to pay another, you may want to consider bankruptcy before it all catches up and collapses.
- 4. You are being sued for a debt or have a pending lawsuit against you.
If you have received a lawsuit from a credit card company or been sued by anyone of your creditors, bankruptcy may be around the corner. It takes a lot for a credit card company, or anyone for that matter, to file a lawsuit. That’s because if it has come to filing a lawsuit, it’s likely that the party suing has tried to collect for sometime. Since lawsuits cost money to file and prosecute, that means that the creditor believes there is something to get from you, and that they are at the end of their friendly means of collection.
Once you have been sued, it becomes a matter of public record and is reflected in your credit reports. What ever you do, it’s unlikely that you will be obtaining new credit in the near future or while the lawsuit is pending. Very few potential creditors welcome those who are being sued for other debts they did not pay. The worst part of a lawsuit is if the creditor gets a judgment against you. That’s when things can go from bad to worse. Depending on what assets you may have; they can garnish your wages, put a lien on your home, personal property, bank accounts, and any other nonexempt property.
If you have a lawsuit pending against you, you might want to consider filing for bankruptcy to stop the lawsuit and to prevent the party suing you from ever getting a judgment.
- 5. If you’re behind on House or Car payments, and can't convince the creditor to accept a partial payment.
Most people who owe money or have debt of any kind have probably fallen behind or gone past the actual due date at least once. Creditors, especially secured creditors, can sometimes be forgiving in those occasional situations. Many creditors have programs to defer your regular payment or may allow you make a partial payment, if you anticipate falling behind or not being able to make a full payment timely. When not making a payment on time becomes chronic, or you have fallen so far behind that the creditor won’t even accept a partial payment, then its possible that you will soon be facing a potential foreclosure, repossession, or lawsuit by that creditor. It’s also a sign to at least consider filing for bankruptcy before any of those possibilities become a reality.
- 6. You are afraid to answer your phone for fear of collection calls.
If you cringe every time the phone rings, or you let all unknown calls go to voicemail, then you may want to consider filing for bankruptcy. Although you might not be literally afraid to answer your phone, you probably just want to avoid the rude & incessant collection calls by your creditors. Many bill collectors will let the phone ring until someone answers the phone. They can be relentless.
Nobody wants to deal with a rude bill collector. Oftentimes their tactics can be obnoxious. Constant, incessantly rude calls all throughout the day and night can make people apprehensive to answer their phone. If this sounds like your situation, maybe bankruptcy is an option to stop the collection calls, and allow you to answer your phone without worry.
- 7. You kite checks, write hot checks, or questionable ones.
Writing a hot check is a criminal act. If you write a check knowing that there are no funds available to pay it, then it is considered a crime. Don’t let creditors and bill collectors make you a criminal. When you write a check to a creditor knowing the money isn’t there yet, but hope the money will be there at some point it can become a very bad situation. Writing bad checks will make a bad debt situation worse. Even when creditors induce you or scare you into to post dating a check for a future date, they can process them earlier to your detriment. Payday loan companies and others prey on those in need and may invite you to post date a check for a higher amount in order to get more money from you. Don’t let this happen to you.
When you send out a credit card payment in the mail but have no money in your bank account, yet hope the check won’t hit the bank buy the time you put money in the account, that is called “kiting”. Kiting is illegal and you shouldn’t let bill collectors make a criminal out of you. If your debt has gotten out of hand, and you are kiting checks, you should consider filing for bankruptcy.
- 8. The IRS-Internal Revenue Service is garnishing your paycheck or has levied your bank account.
If you owe the IRS money for anything which has evolved into a garnishment, lien, or a levy, then you probably have some debt problems, at least with the IRS. Although it may be a surprise to many people, bankruptcy stops garnishment, even from the IRS. Bankruptcy can also get rid of certain income taxes and allow the taxes that can’t be eliminated in bankruptcy, to be repaid over time.
Bankruptcy and taxes can be complicated subject but whatever the particular facts of your case may be, you might want to consider your options in bankruptcy since an IRS wage garnishment or an IRS levy is usually not a good thing.
- 9. Creditors are calling your friends, relatives and neighbors.
Creditors will go to great lengths to get you to pay. When you stop taking their rude and incessant phone calls, they may escalate the situation to shame, embarrass, or aggravate you into paying. If a creditor can’t reach you at home or your work, they usually have the authority to contact friends, relatives or anyone else you may have put down on the initial credit application. When you signed the application there was probably a question which asked for a name, address, and telephone number of a relative not living with you. Most likely, it also asked for the same contact info for some friends or neighbors. If a neighbor, friend, or relative is passing on messages to you from your creditors, it can be sign that you might want to consider filing for bankruptcy.
It’s embarrassing to have friends, relatives, and neighbors know your personal financial affairs. Despite the frustrating and tacky collection technique of calling friends or relatives, it’s usually not illegal for the creditors to do so. When creditors are hunting you down, and uncle Joe, your best friend, your employer, or your next door neighbor have collection messages for you, it’s a sign that you should consider bankruptcy.
- 10. You use your credit cards to pay for everything including basic living expenses.
If you are using credit cards to buy groceries, gas, pay utilities, or anything else considered to be a basic necessity, then you may want to step back a moment and see what the problem is. It is very easy to run up huge debts using your credit cards for basic living expenses. If you don’t pay them off at the end of the month, you essentially are paying interest to eat, and the debt never seems to go away. It just gets bigger. When you pay for everything with a credit card, it can seem like you’re not spending real money which may cause to buy items you wouldn’t usually buy. When you get your credit card bill, you may be surprised what you purchased with your card as opposed to what you might buy if you were paying in cash. If you never have any cash, or never seem to pay off your credit cards because you use them for basic living expenses, you may consider bankruptcy as an option to get rid of your credit card debt.
- 11. You can’t even afford the minimum payment due on your credit cards.
When you have a lot of credit card debt, high balances, or are over the limit on your credit cards, that means the credit card interest is growing and your minimum monthly payment is growing as well. When you first got your credit cards, the minimum payment due was probably low, maybe $20.00 to $40.00 or possibly nothing at all. After charging awhile, a few setbacks, some more credit cards, and you could find yourself with $300.00 to $500.00 to even $1,000.00 plus minimum payments each month. Once you are no longer able to make the minimum payments, problems are usually right around the corner. If you can’t even make your minimum payments on your credit cards then you may want to see what filing bankruptcy can do for you.
- 12. You are stuck in the payday loan cycle or use payday loans to make ends meet.
If you are in the cycle of payday loans or have been for sometime, then it may be time to consider filing bankruptcy. Bankruptcy gets rid of payday loans once and for all. If you never seem to be able to pay them off, you’re not alone. It’s quite common for people to use a payday loan once and then get stuck using them over and over, to the point where a $100.00 temporary payday loan has ballooned to a $1000.00 not to mention all the interest they have paid. It can be worse if there is more than one payday loan. It compounds interest and compounds the problem.
If you can’t live without using a payday loan to get by, that can be a serious problem. You may not be making enough money or living beyond your means. Either way, the cost of using payday loans to make past due credit card payments, medical bills, or any other unsecured debt should be weighed against filing for bankruptcy. Bankruptcy can eliminate payday loans. So if you are caught in a payday loan cycle, you might consider bankruptcy as an option to get rid of the debt.
- 13. All of your most valuable personal items are pawned or are frequently in and out of pawn shops.
If the manager of a pawn shop knows you by your first name, you may want to consider bankruptcy. That is to say if he or she isn’t a personal friend or relative, but knows you as a regular customer who pawns things weekly or monthly, you may have serious debt problems that bankruptcy may eliminate. Pawn shops, like payday loan companies charge exorbitant interest rates. So much so that it can get you hooked on paying their interest to the tune of 4, 5, or 6 times the money you originally borrowed against your own property. Once you pawn something, and then something else, and something else, you start working for the pawn shop. Once you start that cycle, it is difficult to stop if you want to keep your property.
If you pawn your personal property to make minimum payments on past due credit card payments, medical bills, or any other unsecured debt, or pawn things to just to get by, you may want to consider bankruptcy. Bankruptcy Law, allows you to keep specified amounts of personal property, including jewelry, household goods & appliances, guns, and most other items you’ll find in a pawn shop. If you have debt problems, and are pawning items to pay other debts, you may be throwing your money away. You should consider your options in bankruptcy before it’s to late.
- 14. Your car is going to be repossessed.
If your car, truck, RV, SUV, or any other vehicle you may now own is being hunted by the repo man, you may want to consider filing for bankruptcy. Chapter 13 Bankruptcy will stop repossession and allow you to repay any money you are behind over 3 to 5 years. If you car has been recently repossessed, bankruptcy may allow you to get it back. Don’t wait until the repo man is in the driveway or your repossessed vehicle is on the auction block before you consider bankruptcy. If you are eligible, Bankruptcy stops repossession. So when you car, truck, RV, or SUV, is soon to be repossessed, you may want to consider filing for bankruptcy to keep your vehicle.
- 15. Your house is up for foreclosure and going to be sold at the next foreclosure sale.
Foreclosure is usually never a good sign, so if your home is posted for foreclosure, you may want to consider filing for bankruptcy. Even though there are several options to stop foreclosure, many of those options don’t always lend themselves to timeliness, nor do they absolutely stop foreclosure. If you are eligible to file for Chapter 7 or Chapter 13 Bankruptcy then filing bankruptcy will stop foreclosure. So if your home is up for foreclosure, you may want to consider filing for bankruptcy before your home is sold.
Don’t Lose Everything… Don’t Ignore the Bankruptcy Warning Signs…
If any of the Bankruptcy Warning Signs above seem to be happening to you, then you may want to consider your bankruptcy options. Many people have filed for bankruptcy to deal with their debt. In fact, Bankruptcy Laws were enacted to help people to relieve their debts and get a fresh financial start.
If you are having financial difficulty or are drowning in debt, contact, The Law Offices Of R.J.Atkinson. As Texas Bankruptcy Lawyers, we have helped thousands in Texas to eliminate, reduce, and reorganize their debts. Contact us for a free bankruptcy evaluation and a free bankruptcy means test to see if you are eligible to file for bankruptcy. If you are eligible, we can help you file for Chapter 7, Chapter 11, or Chapter 13 to reduce, reorganize, or completely get rid of your debt.
Whether you live in Houston, San Antonio, Austin, Dallas, Waco, San Marcos, Temple, Kyle, Buda, Baytown, College Station, Bryan, Dennison, Round Rock, Georgetown, Plano, Garland, Irving, McKinney, Carrolton, Denton, Katy, Richardson, Sugarland, New Braunfels, Seguin, Humble, Boerne, Kerrville, Addison, Arlington, Victoria, Sherman, or most anywhere else in Texas, we can help you determine your eligibility to file for Bankruptcy and can help you decide if Bankruptcy is and viable option for you.
Call Texas Bankruptcy Lawyer R.J.Atkinson: 800-436-9056