Bankruptcy works best if it solves your short-term problems, while at the same time gives you a fresh start towards a productive and lower stress life. The right type of bankruptcy for you is the type that puts you on the road towards a happy and healthy financial future.
The “counseling” part of my job involves helping you see the big picture. While I appreciate your business, I do not want to file a bankruptcy case for you today, only to have you reappear in my office in five or six years because you are once again in debt. I would much rather that in the future you call me for advice about your new business venture or how to protect the money you have saved!
Can Bankruptcy Offer “Peace of Mind?”
Without sounding hokey, I think that bankruptcy is as much about peace of mind and reducing stress as it is about financial matters. Divorce lawyers will tell you that financial problems underlie most marital issues and physicians will tell you that stress can lead to heart attacks and strokes. If bankruptcy can relieve you from the unyielding pressure of unmanageable debt then you should most definitely consider it.
When I meet with you, I will make two statements that you may find a little surprising:
First, I will tell you that “bankruptcy is not a good thing and that you should avoid filing if at all possible.” While bankruptcy can be appropriate or even necessary, I would not want to have to file, nor would I want to see my friends or relatives in bankruptcy. Calling me or even viewing my bankruptcy web site was probably one of the more difficult things you have done in your life and I know that you want to make sure that filing bankruptcy truly makes sense for you.
Second, I will tell you that “since you are speaking to a bankruptcy lawyer, everything needs to be on the table.” You may have to make some difficult decisions. For example, if you have co-signed for an adult child’s car loan, I may very well tell you that you should use your bankruptcy to cancel your obligation on this loan, and your adult child may have to refinance. I will insist that you carefully consider whether you can afford your current house or vehicle, since bankruptcy can be a tool to cancel those obligations. If you have time shares, I will probably tell you to cancel those obligations in bankruptcy. The obligations that put you in my office are not going away unless you make some changes, and sometimes a third party, i.e. me, can help you find clarity.
So, as you consider whether to file, and if you do file whether to file Chapter 7 or Chapter 13, I want you to step back and think about your life now, your life in 5 years, your life in 10 years and so forth. If your goal involves living debt free and with a healthy retirement account, the question to ask yourself now is whether a bankruptcy filing now is more or less likely to help you reach that goal.