While there is no rule that prevents one from filing a bankruptcy at any period of time, one can only file bankruptcy every 8 years or so (8 years from the date of the discharge of the prior bankruptcy). We often get asked when is it a good time to file for bankruptcy. Below, we will go through some factors when deciding when to file for bankruptcy.

One Should File a Bankruptcy in Los Angeles After Exhausting All Other Options

Bankruptcy should sometimes be the “last resort” after all attempts to cure a default have been exhausted. For example, if your only debt is a $2,000 credit card, it may be more beneficial for you to negotiate with the credit card company and try to negotiate a pay-back agreement as opposed to filing for bankruptcy. On the other hand, if your debts are much higher, or if the creditor is not willing to negotiate with you, bankruptcy may be a plausible solution. If that is the case, contact a Los Angeles bankruptcy attorney who will discuss your options.

One Should File a Bankruptcy in Los Angeles After Incurring the Debt

When filing a Chapter 7 case, an individual is asking the Court (using bankruptcy laws) to wipe out all debts that occurred prior to the filing of the bankruptcy. In other words, any debts that are incurred after the bankruptcy would not be wiped out. This is important when considering when to file bankruptcy. One important thing to note is that the Bankruptcy Code forbids racking on debt for the sole purpose of filing a bankruptcy. In other words, a debtor cannot go on a shopping spree using credit cards, and then file a bankruptcy right after for the sole purpose of wiping the debt on these cards.

One Should File a Bankruptcy in Los Angeles When There is an Imminent Lawsuit or a Foreclosure

There are situations which require an immediate and emergency filing of a bankruptcy in Los Angeles. For example, if a creditor has filed a lawsuit against you, you may want to file a bankruptcy since it will put a stop to any lawsuit, and potentially rid of the debt that serves as the basis for the lawsuit. Additionally, if there is an imminent foreclosure on your home, a bankruptcy could help you put a halt on this foreclosure so that you can either work something out with the lender, or obtain additional time to remain at the property

Want to Learn More About When You Should File a Bankruptcy, Consult With a Los Angeles Bankruptcy Attorney Now!

If you or your loved one is considering bankruptcy, give us a call now. We would be happy to talk to you. Also note that in light of social-distancing, we are willing to conduct our free consultations by phone or by video. Just call us to set up an appointment.

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