Filing for bankruptcy in Ohio can be an important first step to securing a stable financial future. However, the decision to file bankruptcy should not be taken lightly. For those who are considering filing bankruptcy, there are some guidelines that they can use to determine whether or not it is a good decision.
A person may need to file for bankruptcy if debt balances are still growing even though a person is making payments on all of the debt that he or she has. Numerous large debts with high interest rates can be all but impossible to pay off due to the amount of interest accruing on top of the existing loan balance. When a person is making a good faith effort, but the debt keeps piling up, bankruptcy may be the only option to escape the debt.
Loss of Income
Economic and life changes can have a devastating financial impact on individuals. Whether a large manufacturing plant shuts down, a government office is moved to another location or a disability causes a person to lose his or her job, a loss of income can force a person into bankruptcy. When a person loses a good paying job, there may be no way to repay money that was borrowed based upon a reasonable belief that a person’s income would not significantly change.
Loss of Home
A person who is at risk of losing his or her home to foreclosure or other financial problem should look into filing bankruptcy. Rather than just losing the home, a person who files bankruptcy may be able to restructure the home loan to make it more affordable, discharge other debts to make paying the mortgage easier or a combination of both restructuring and debt forgiveness. The loss of a home is such a serious matter that having a home at risk is reason enough to consider filing for bankruptcy.
Negative Net Worth
A simple addition of a person’s total assets and total debts determine his or her net worth. In general, a person with a negative net worth (one that owes more than he or she owns) may need to file bankruptcy to prevent the problem from getting worse. This is especially true as a person ages as an older person needs to be saving money for retirement and not spending all of his or her income on paying off existing debts.