You want to file a bankruptcy but cannot decide when. At times, you may be better off delaying because you may get to keep your property. Or, maybe you could deal with debt in some other way, and not announce bankruptcy. We’ll highlight some common scenarios, and give you a relevant advice on each. Bankruptcy filing timing is crucial for your desired outcome.
Bankruptcy Filing Timing
If you want to change your mortgage
Do you want to file bankruptcy to delay foreclosure? Not a bad approach, but your timing is important. Many of you end up filing early, and so face difficulty in obtaining mortgage modifications. Why? Because when you file bankruptcy, the promissory note is waived off, and lenders don’t negotiate with you anymore. After all, there’s nothing left in it for them.
So, if you want changes to your mortgage, avoid filing a bankruptcy.
If your income is relatively greater
If you opt for chapter 7 bankruptcy, your income in the past six months should be less than the state median for your family size. If this isn’t the case, you become ineligible for chapter 7, and will have to file chapter 13, which implies that you would be paying some of your debts.
So should you wait or file? If your income has fallen down, it might be better to wait because you may become eligible for chapter 7 bankruptcy then.
If you don’t want to lose your property
Chapter 7 bankruptcy requires you to give up some of your assets. If you delay, you may be able to keep them.
If your debts are expected to grow
If you feel you may want to take more loans in the near future, you should hold off bankruptcy for some time. Generally, only those debts are discharged, which you owe on the date you file.
Before you file for bankruptcy, contact an experienced bankruptcy lawyer in Houston TX for help. Debt relief strategies should always be backed by an educated decision.