There are many reasons to enter into bankruptcy. There are many reasons to avoid bankruptcy.

Take this simple bankruptcy test to see if you might need to file for bankruptcy:

1. Do you struggle every month to make ends meet?
2. Do you have over $5,000 in credit card debt?
3. Are you making repeated late payments or missing payments altogether for credit cards, car loans, mortgages, or other debt?
4. Do have no significant cash savings?
5. Do you have severe debt anxiety, that is, persistent worry about your debt load?
6. Do you have no ability to earn more income that you are currently?
7. Is your credit rating very low, or falling?
8. Have you been involved in previous debt relief, consolidation, or other programs to handle your debt and now find yourself in the same unmanageable position?
9. Are you borrowing money from friends, family and others to keep your head above water?
10. Do you have multiple credit cards?

If you find yourself answering yes to three or more of these questions it is possible that you might be in financial jeopardy, and bankruptcy may be a potential solution. Please understand that bankruptcy is not without its downside, but, if the only way you have to go is up…then bankruptcy could be the correct option for you.

Before Filing Bankruptcy in Massachusetts

Consider your other options to get yourself out of the financial hole that you are now in. Here are some very useful solutions.

1. Increase Your Revenue
   It goes without saying that increasing your weekly income may straighten out your financial life. If you are able to work a second or even a third job, you may need to consider those options to increase what’s coming in.

One cautionary note about increasing your revenue stream. Oftentimes, the reason that a person finds themselves in debt involves a lack of knowledge about how to manage personal finances. There are many resources available, self-help budgeting and other plans that can be instrumental in teaching you how to manage your money. Do not be afraid or too proud to ask for help, there is plenty of it out there.

Decrease Your Spending

How, you might ask, do I stop spending what I currently am? I don’t have much to begin with, or I need everything that I do have, you may think to yourself. Once again, successful personal finances require a deep dive into your habits. I recommend writing down on paper your expenses each week and budgeting a weekly dollar amount. Comb through this list looking for ways to prune your spending. You might just find that you have more wiggle room than you think.

Sell Assets

If you are lucky enough to have assets that you can liquidate, you may want to consider doing so to handle your debt. Prior to liquidating assets, particularly large assets like homes, boats, vacation homes, etc., it is wise to consult with an experienced professional so you can weigh out the options available to you.

• Debt Consolidation
  It is possible to work with a company that specializes in consolidating debt. Often these programs will provide a lower interest rate, but sometimes the fees to the debt consolidation company involved in these plans can be a bit heavy.
• Debt Settlement
  Sometimes it is possible to work out a debt settlement with your creditors. A licensed attorney will do the work necessary to lower your consumer debt up to 60% of the total balance owed.

I Don’t Want to Consolidate, Settle My Debt, Increase my Hours, Sell My Assets, or Reduce My Spending…Now What?

What Makes Attorney Gaudet Different?

You may have multiple reasons for not wanting to consolidate or settle debt, increase working hours, sell your home, car, or boat, or reduce the amount of money you spend each week. Moreover, the reasons for not wanting to do all of these things may be very valid or they may be entirely frivolous, either way, the reasons are your own. Attorney Gaudet will never treat you with anything but complete respect. Attorney Gaudet understands that there are many events in life that can cause any one of us to change course radically, placing our financial life in a tailspin. Or perhaps, maybe your financial situation is not that severe. Take the time to speak with Attorney Gaudet so that he can review your finances and offer you the best solution to your problem.

Is Bankruptcy Right for Me?

Whether or not to file for bankruptcy is a personal choice, but we do not expect you to be a bankruptcy expert. If you are a Massachusetts resident, attorney Gaudet is prepared to provide you with a thorough free analysis of your present financial condition and then offer you solutions to improve your lot if at all possible. There are certainly times when bankruptcy is not right, no other option is viable, and doing nothing may be the best solution. For example, you may be receiving Social Security income that is may be untouchable in the bankruptcy process and have no assets. If that situation describes you, contact us first, but it may be possible that doing nothing is your best option.

Chapter 7 Bankruptcy in Massachusetts

While not everyone can qualify for chapter 7 bankruptcy, many do. In order to qualify for chapter 7 bankruptcy you will need to pass the means test, which will we do for you. As a rule of thumb, if you have over $100 left over every month after paying your personal expenses you likely will not qualify. Still, call our office to find out if you do qualify for Chapter 7 bankruptcy as a Massachusetts resident.

It is important to understand that filing for Chapter 7 bankruptcy liquidates your assets to payoff and eliminate debts. Even if you have no assets to liquidate, if you pass the means test under Chapter 7, you may be able to have all of your debt completely discharged.

Your credit will be affected by filing for bankruptcy, and while this is a serious side effect of filing for bankruptcy in Massachusetts you can still rebuild credit over time.

Chapter 13 Bankruptcy in Massachusetts

The key to a Chapter 13 bankruptcy is the allowance under this federal law for the debtor (you) to payoff your creditors over time through a repayment plan. While the details involving your particular financial circumstances will vary the results of a Chapter 13 plan, it is very possible that you will be able to keep most if not all of your property. Filing a Chapter 13 bankruptcy in Massachusetts is particularly useful for debtors who possess significant assets, for example, a home, cars, boats, etc., and who may have enough present income and stable future income outlook to warrant a Chapter 13 bankruptcy plan.

Positive Side Effects of Bankruptcy

The moment you file for bankruptcy you are able to begin the process of stopping most lawsuits, foreclosures, and other attempts to collect a debt. Filing for bankruptcy may also open the door to negotiate with the IRS for the purpose of stopping interest or stopping fees and penalties while entering into a payment plan with the agency.

Negative Effects of Bankruptcy

The biggest negative effect of filing for Bankruptcy in Massachusetts is the affect that filing bankruptcy has on your credit. Your credit score will drop precipitously and you will have the bankruptcy stay on your record for 7 years with Chapter 13 and 10 years with Chapter 7. Keep in mind that it is still very possible to rebuild your credit and your financial life after filing for bankruptcy. Contact our firm to learn more.

The Bottom Line Regarding Debt Management

If you are struggling to pay your bills I challenge you to do the following:

1. Take a step back from the situation and recognize that you have the ability to get control of your financial situation. The ultimate solution to achieving control may be something that you have not thought of previously or the solution may be staring you in the face. Do not be afraid to admit to yourself (if this is true, of course) that you do have a financial problem and need to find a solution to fix it.
2. Look at the many options available to you. Once again, you can call our office and you will receive an overview of methods you might want to use to correct the problem. Take some time to think about options presented to you or those that you discover on your own, and then try them.
3. If some of the more admittedly extreme options are all that are available to you, i.e., chapter 7 or chapter 11 bankruptcy, make sure you understand fully what effect these will have on your financial situation (both the pros and cons).
4. Write any solutions down on paper or in an Excel spreadsheet to fully evaluate each option. Again, take the time to think through each and what your life will look like as a result of any path contemplated.
5. Stop being hard on yourself. Perhaps you were extremely unlucky and the reason that you are in the financial situation that you find yourself in has more to due with unfortunate circumstances, for example, a death of a spouse, or some other tragedy. Or, perhaps, the reason you find yourself in financial dire straits has occurred because you completely mismanaged funds, took out massive loans, and spent way beyond your means. The point is that no matter the cause, you have do not need to force yourself into oblivion, you do not need to feel like you are a failure and stick with that feeling. Instead, may I respectfully offer the following:

We all fail…sometimes of our own accord, sometimes not, but we all fail. The difference between being a failure or not is that one person gives up and the other gets up.

DISCLAIMER:
The information provided in the pages and posts of this website are for general informational purposes only. The information presented on this site is not legal advice, and no attorney-client relationship is formed by the use of this site.

BANKRUPTCY BASIC INFORMATION FORM

By filling out this form no attorney-client relationship is created between yourself and the Law Offices of Richard Alan Gaudet, LLC, however, an attorney will review your entries and make contact with you within short order to discuss you circumstances. If you and the attorney wish to proceed and create an attorney-client relationship, you will receive a fee/engagement agreement for your review.