Waiting to file bankruptcy has some negative impacts

On Behalf of | May 4, 2020 | Bankruptcy Law Basics

When you realize that you don’t have enough income to pay your bills, you probably know that you have to do something to change the situation. One option is filing for bankruptcy; however, there are many people who try to avoid doing this. They might feel as though they are giving up on their obligations and that they are taking the easy way out. Neither of these is true.

Waiting to file for bankruptcy when you need to use the protections it provides can lead to serious issues throughout your life. Filing quickly is one of the only ways that you can eliminate mounting difficulties.

Financial impacts of waiting

The longer you wait to file, the worse your financial situation might become. This is because interest and fees continue to add up while you don’t do anything. This could mean that you have to pay when you file bankruptcy. While this isn’t going to be the case if you’re filing a Chapter 7, it can be a consideration if you plan on filing a Chapter 13.

There is a chance that trying to continue making payments to creditors could make you fall behind in your other bills. This may mean that you’re facing an eviction or utility shut-off. When you file, you’re likely going to free up money that you can use to pay those bills.

Emotional and health damages of putting it off

Around 60% of people who put off filing for bankruptcy for a long period report that they’ve gone without medical attention. Just shy of 32% said they went without food. Not only can this have a negative health impact on you, it can also wear on your emotions. There is also the chance that your mental health state will suffer if you have to continue to deal with the creditors. You may find relief from this because of the automatic stay that’s issued when you file for bankruptcy. That order prevents creditors from being able to contact you in any manner.

The best thing that you can do right now is be honest with yourself about your finances. If you know that you’re going to need bankruptcy protection, file as soon as you realize it. Learning the specific benefits of filing will help you to make a more informed decision.