Any single parent knows the struggle of trying to raise a child, but that difficulty only increases when bills begin to pile up. You may find that you are not able to afford the lifestyle you once had, or perhaps you realize that your child is suffering because of it.
Financial issues are one of the major reasons people get divorced in the first place, but the problems don’t end there. Many people have money problems after divorce. Trying to make it as a single parent is challenging. As a result, many single parents consider bankruptcy.
Are you thinking about filing for bankruptcy? You have options. Keep reading to learn more about your financial and legal options.
Decide If Bankruptcy Is Right
You have many questions to ask yourself about your current financial situation before you determine that bankruptcy is the right choice. These questions are just the beginning.
Are you able to make minimum payments on your credit cards? If you are only able to make the bare minimum, you might consider bankruptcy. If you are paying off your bills just fine, you might not be a good candidate for bankruptcy.
Are you currently receiving phone calls from debt collectors? If so, you might not even know how much money you owe. You should look into the specific amount of money reported under your name.
Are you using credit cards to pay for your necessities? If you are unable to pay for your necessities without putting it on credit, you may be a good candidate for bankruptcy.
What liquid assets do you have right now? Consider everything from your retirement accounts and stocks to vehicles and savings accounts.
Many single parents wonder if they can still file for bankruptcy while receiving child support. The truth is that parents who receive child support can still file for bankruptcy.
Know the Types of Bankruptcy
Two types of bankruptcy are available. You can discuss the options for each type of bankruptcy with your attorney.
Chapter 7 is a simple bankruptcy and is usually the right choice for moderate and low income single mothers and fathers. Most Chapter 7 bankruptcy cases can be structured so that a single person parent is able to keep their home, car, and tax refunds. Almost all retirement accounts are exempt assets that you can keep. If you are a single parent facing hostile creditors, consider Chapter 7 bankruptcy for a fresh start. Not only does Chapter 7 bankruptcy forgive things like credit card debt, personal loans, and medical bills, it also provide protection against payday loan creditors. It can also wipe out past-due utility bills, business debts, and some tax debt.
Chapter 13 bankruptcy is used to fix missed house payments, reduce car loan interest, and arranges to pay recent delinquent taxes. Chapter 13 is a uses a court supervised payment plan which restructures your debts allowing you to keep the assets necessary to take care of your family. If you are behind on your house, car, or furniture payment, you may want to consider this option. Also, while in Chapter 13, student loan creditors are required to leave you alone.
Both types of bankruptcy allow you to reset your finances. A completed bankruptcy usually improves your chances of getting a new loan.
Speak With a Bankruptcy Attorney
Ultimately, bankruptcy may be the best way to improve not only your life but also the life of your child. If you think bankruptcy is the most valid option in your situation, you should consider speaking with an attorney who can ensure you are on the right path.
Whatever you do, do not ignore money problems. They will worsen with time.
Gather all the necessary documents before speaking with an expert who works in bankruptcy. All your financial information is relevant to your case. Include bank statements, pay stubs, invoices, and loan agreements.
An expert bankruptcy attorney can provide you with the information you need to make a smart decision. Wiesner & Frackowiak, LC, may be able to help. Don’t let creditors keep you awake at night or call you at work. Call today for a free initial consultation.