The Symptoms of Bankruptcy Part II

23 Jul The Symptoms of Bankruptcy Part II

The reasons individuals file bankruptcy are varied.  Part I of this series dealt with co-signing debts for others.  This part deals with problems that arise when individuals maximize their credit limits by using all available credit without making any meaningful payments.

Maxing out the credit cards should be an obvious warning sign but sometimes it is not.  For example, there are two scenarios where I see this problem all the time.  First, I cannot tell you how many times that individuals have moved to Florida on the promise of having a job when they relocate.  Of course, the job doesn’t pan out or for some other reason no longer exists.  The credit cards were used for the moving expenses with the intention of repayment; however, with no income, the credit cards become the only source of revenue. Second, self employed individuals who continues working hard, running their businesses, and yet are unable to collect the money owed to them as receivables.   They use, what I like to call, secondary financing, the credit cards, thereby strapping their business with additional debt, and at the same time, eliminating the potential margins that they were working for in the first place.

Let’s face it, if you are making the minimum monthly payments on your unsecured debt (lines of credit, credit cards and/or personal loans) without a reasonable plan of making  substantial payments to reduce the debt, you are facing a very serious situation.

Related Posts Plugin for WordPress, Blogger...
The following two tabs change content below.
Carmen Dellutri is a proud member of the Florida Bar, and he is a Board Certified Consumer Bankruptcy Attorney, Certified by the American Board of Certification. He practices in the areas of Consumer Bankruptcy and Plaintiff's Personal Injury. He is the principal attorney at The Dellutri Law Group, P.A. The firm supports many charitable and civic causes by donating time and much needed capital to our community. Mr. Dellutri and the other attorneys in the firm routinely speak to students of all ages about various legal and societal issues.
No Comments

Sorry, the comment form is closed at this time.