What Leads to Bankruptcy: Four Common Causes
May 21, 2021
Bankruptcy does not just happen overnight. While you may receive a bankruptcy notice, a harassing call from a creditor, or an eviction notice on a day you weren’t expecting it, this day was already in the works for a while. For people struggling with debt, past choices and unfortunate circumstances can put them in situations where they cannot pay their bills and fear that they will lose everything.
There are several reasons people find themselves in need of filing for bankruptcy, but the four most common issues are below.
Credit Card Bills
Without strong discipline, credit card bills can get out of control quickly. It is easy to forget how much you charge on your credit card when using it for all of your payments. Groceries, clothes, gas, bills, eating out – they all add up quickly, and without a running total of all your purchases, credit card bills can become outrageous.
Often unforeseen and usually the most expensive form of personal debt, crippling medical debs can leave people overwhelmed and in fear. Accidents and severe illness can lead to tens of thousands of dollars in medical bills. Insurance will only cover a certain percentage, leaving debtors to pay the rest. Unfortunately, many people use their credit cards to pay medical bills, making credit card debt even worse.
People need money to come in so that they can pay their bills. If you lose your job, are demoted, or never receive the raise you were promised, debt can arise. Without significant money coming in, debtors are unable to pay monthly bills.
Separation or Divorce
When a marriage dissolves, everyone is affected. If both spouses were working, they had two incomes to apply to bills. If only one spouse was working, the other spouse was entirely dependent upon support. If separation or divorce splits a family’s income, and if alimony or child support is required, financial burdens can become devastating.
The firm of George R. Belche, Attorney at Law LLC, located in Lawrenceville, Georgia, focuses on helping people resolve their financial problems through bankruptcy. We want you to know that if you are feeling the burden and fear associated with significant debt, there is hope. Contact us for a free initial consultation to discuss your specific situation.
George R. Belche, Attorney at Law
Lawrenceville, GA 30046