Is bankruptcy a better option if the amount gets to high as opposed to making minimum payments for the rest of my life?

Question

I was in a serious accident 18 months ago with no insurance, my credit and debt is off the charts ($250k). My credit was good before that. I will never get that amount paid off. But it may be possible to make minimum payments forever.

Philip Boardman · Answer

You should probably look into filing a chapter 7 bankruptcy which would  quickly take away your debt.  However, if you had to file a chapter 13,  that would last no longer than 5 years. It seems like either one of  those options would be better than paying the rest of your life.

Nanina Takla · Answer

You should sit down with a bankruptcy attorney to go over your options.  Many bankruptcy attorneys offer free consultations. Whether or not it  makes sense for you to file will depend on your individual situation . .  .  I will say this  assuming a bankruptcy is feasible in your  situation, a bankruptcy discharge would wipe out all your unsecured debt  (i.e. credit card debt, medical bills). For many people, getting rid of  that debt would be a more attractive option than making minimum payments  for the rest of their lives.  Good luck!

Kevin Bruning · Answer

Bankruptcy may be a good option for you depending on all of your circumstances. You will need to meet with an attorney to analyze your debt, income, expenses, and assets to determine if you are eligible. If you have significant debt that you are unable to pay off, bankruptcy may provide you with some financial relief.

Nancy Harkess · Answer

Eliminating huge medical debt is one of the most important benefits of bankruptcy.  This is not debt you just went out and ran up without thought as to how you would eventually be able to pay it off.  This is debt over which you had no control - possibly a case of life and death.  While a Chapter 7 bankruptcy declaration may remain on your credit rating for 10 years from the date of filing, that is preferable to a lifetime of payments and debt you have no way of paying off.

Jay Moreland · Answer

I have heard, but cannot verify, that the most common reason people file bankruptcy is medical bills. It would be best to consult with an attorney who can review your entire situation, but it sounds to me like bankruptcy may be a good idea for you. Whether to file or not is a subjective question. As a general rule I advise clients that if they can see light at the end of a tunnel they should press on until they come out of the tunnel or the light goes out. When the light goes out, it is time to file bankruptcy. A bankruptcy will give you a financial fresh start. The law was created because there are times when there is no hope that a person can get out of debt. With a new start the person could be successful. Without one the debt will cripple the person's future and hold them back from ever being financially successful. Some famous people filed bankruptcy. Walt Disney, Donald Trump, Michael Jackson, Henry Ford and many others have had tough financial times and filed bankruptcy.

Beth Bizousky Carter · Answer

Bankruptcy is an option to learn about so you can make an informed and educated decision if filing bankruptcy is the right path to take in this situation with the debt load you are carrying.  I recommend you schedule to meet with an experienced bankruptcy attorney for a consultation.  Many do not charge consultation fees.  This will allow you an opportunity to learn more about this option with your particular facts so you can make the right choice as to how you will handle this debt load.

Edward Olson · Answer

Bankruptcy is not the only way to reduce your debts.  Call an attorney to discuss your options.

Diane Drain · Answer

The important point is that you are asking questions now before this becomes a nightmare.  There is no specific amount that is necessary before someone contemplates filing for bankruptcy protection.  $5000 in debt for one person is like $500,000 for another.  So it is very smart of you to be asking questions about bankruptcy very early.  Please understand that filing for bankruptcy is a very complicated process.  It is wise to talk to an experienced bankruptcy attorney before deciding to take this important step.

Loren Zahn · Answer

It is probably a good option for you to get a financial fresh start.

Timothy Byrne · Answer

I would explore filing a Chapter 7.

Stuart Nachbar · Answer

Try talking w/ a qualified bankruptcy professional as it may be a better option.

Douglas Dern · Answer

You better file.

Kate Starkebaum · Answer

Bankruptcy may be a good solution to wipe out all of your debts, rather than making the minimum payments forever.  You should consult with a bankruptcy attorney to determine what chapter of bankruptcy is best for you.

John Schleiffarth · Answer

Whether or not you need to file bankruptcy is ultimately a personal decision. I recommend considering bankruptcy if you cannot reasonably foresee paying back your debts and you cannot afford your basic living expenses without filing.

Steven Alpers · Answer

It depends on your income whether you would qualify for a 7 or 13 but eventually you will get sued or you will have more interest than principal and never make any headway.

Meredith P. Ezzell · Answer

Bankruptcy is definitely a better option than facing that mountain of debt for the rest of your life.  You should seek the counsel of an experienced bankruptcy attorney in your local area to discuss further.

Find a Lawyer

Ask a Lawyer

Read Legal Articles

Ask a Lawyer

Read Legal Articles

Is bankruptcy a better option if the amount gets to high as opposed to making minimum payments for the rest of my life?

16 ANSWERS

Find Local Bankruptcy Lawyers

Helpful Resources

Ask a Lawyer