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These 5 issues often precede bankruptcy

On Behalf of | Jun 6, 2023 | Bankruptcy Law |

In a turbulent economy, it does not take much to spark a personal or business financial crisis. Many Mississippi residents are currently struggling to keep their businesses afloat or even just to make ends meet at home. While every situation is unique, there are five issues that are often relevant to households experiencing serious financial problems.  

Understanding the underlying issues that often cause a financial crisis can help lay the groundwork for a strong financial future. There are other resources available to provide debt relief and create a new path toward stability, as well, such as bankruptcy protection. Since there are several programs available, a petitioner must determine which filing best fits his or her needs and overall financial goals, but first, it is worthwhile to identify what issues created the need to seek debt relief. 

Issues that create financial crises 

There are five primary issues that often spark financial problems  that often require outside support:  

  • Loaning friends or family members money 
  • Reduction in or total loss of income 
  • Medical bills 
  • Spending that exceeds available funds 
  • Buying a house that is out of one’s financial range 

Even one of these issues can spur financial crisis. More than one occurring simultaneously can spell disaster, particularly for middle-income families. 

Bankruptcy is a valuable financial tool 

Filing for bankruptcy can help Mississippi residents get back on their feet by alleviating debt. It also activates an automatic stay that, in many cases, is the only thing that will help avoid a home foreclosure. An experienced bankruptcy attorney can help determine which program would be most effective in a specific set of circumstances.