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How Can I Avoid a Second Bankruptcy?

How Can I Avoid a Second Bankruptcy?

Successfully completing Chapter 7 or Chapter 13 bankruptcy provides many people with amazing second chances at financial stability after years of struggling under the burden of significant debts. While the bankruptcy process may not be quick or easy, the end result is always worth it in the end. After all, once important facet of the overall process is that debtors are trained to effectively manage their finances. However, it’s not unusual for debtors to find themselves back in debt if they aren’t careful. Sometimes life throws us unfortunate curveballs that no amount of financial planning can account for.

Second bankruptcies are often caused by:

  1. Divorce
  2. Unemployment
  3. Medical emergencies
  4. Making poor investments
  5. Mismanaging finances

If you find yourself considering a second bankruptcy, it’s important to first discuss your case with an experienced bankruptcy attorney. Together, you can review if you’re eligible for Chapter 7 or Chapter 13, and if you can even file for bankruptcy at all. After all, this option is only available if it’s been several years since your last filing.

Luckily, there are alternative options if you want to avoid filing for bankruptcy a second time.

Talk to Your Creditors

Your creditors do not want you to file for bankruptcy. While your bankruptcy alleviates your debts, it doesn’t necessarily benefit your creditors. If you’re in an uncomfortable financial situation, try contacting your creditors to negotiate an extension or a repayment plan. In certain cases, creditors are even willing to reduce your interest rate just to settle the debt and avoid a future bankruptcy.

Supplement Your Regular Income

The tried and true method of reducing your debt is simply to supplement your regular income and pay it off. This may mean getting a second job or selling nonessential assets and property to pay your creditors. You can also generate extra cash flow just by being frugal and budgeting your weekly expenses.

You can budget by:

  1. Meal planning
  2. Cancelling unnecessary subscriptions
  3. Try “Do It Yourself” repairs
  4. Cut out unnecessary expenses

Schedule a Consultation

At Bach Law Offices, our Northbrook bankruptcy attorneys can review your financial situation, explain your bankruptcy options, and provide you with exceptional legal guidance. Our priority is to help you navigate this complicated process and help you develop the skills you need to stay out of debt.

Contact Bach Law Offices at (847) 448-0025 to schedule a consultation.

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