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3 Reasons Why You Shouldn't Wait Until The Last Minute To File Bankruptcy

Posted By admin || 25-Aug-2010

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Many debtors wait until the absolute last minute to file bankruptcy.

Below are three reasons why debtors should never wait until the last minute to file bankruptcy:

  1. Waiting until the last minute to file bankruptcy leaves a debtor vulnerable to losing their home in foreclosure if they're a homeowner.  As we have mentioned in previous articles, a mortgage servicer has to go through a foreclosure process before they can take possession of a debtor's home. There is only a certain "window of opportunity" for the debtor facing foreclosure to use bankruptcy to save their home.  If the debtor waits too late, and the mortgage servicer has won a judgment for possession, the bankruptcy will not save their home.
  2. Waiting until the last minute to file bankruptcy leaves a debtor vulnerable to creditor lawsuits which can be costly and time consuming.  If a debtor is significantly delinquent on their payments they are most likely vulnerable to facing a creditor lawsuit and many creditors are moving quickly to file lawsuits as the economy worsens. If a debtor waits too long before they file bankruptcy, a creditor can quickly file a lawsuit, win a judgment and then swoop in to seize bank accounts and wages.
  3. Waiting until the last minute to file bankruptcy can leave a debtor vulnerable to vehicle repossession . Many lenders are moving quickly to repossess vehicles. Filing a bankruptcy after a creditor has repossessed and auctioned a debtor's vehicle can spell financial disaster if they depend on their vehicle to travel to and from work.  However, if they owe a balance after their vehicle has been auctioned, the bankruptcy will still discharged the balance of the car loan.
Categories: Bankruptcy
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