If you owe more on your assets than they are worth, you may be what’s called “upside-down” in your debt. If you sold everything you owed, you would still not be able to pay off your debt. Just being upside-down in debt is not necessarily a reason to file bankruptcy if you can keep up with your payments.
If you are losing ground with your debt and falling more behind each month, you may want to consider filing bankruptcy to get your finances back in order. If you’re behind in your home payment and don’t see how you can catch up, filing bankruptcy can save your home and give you time to catch up on the back payments. Second liens, adjustable-rate mortgages, and consolidation loans can quickly get you upside-down, owing more on your home than it is worth.
Automobiles often depreciate in value rapidly. Most Americans owe more on their cars than they can sell them for. Selling it to get out from under the debt often fails since you may still owe on the loan even though you no longer have the vehicle.
If you are unable to keep up with your payments and don’t have a financial windfall coming your way, you may want to consider bankruptcy to get control of your debt. Some factors in choosing the best personal bankruptcy chapters are;
- if you have a large amount of unsecured debt such as credit card and medical debt,
- or if you would like to keep your secured assets like your home and your car and need time to catch up on the payments without losing the right to use the collateral.
Speaking to a Fort Worth bankruptcy attorney can help you decide on the best type of bankruptcy for your unique situation to get the most financial relief.