Thomas F. Miles, Attorney and Counselor at Law
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When does it make sense to file for personal bankruptcy?

Financial troubles have a way of sneaking up on consumers. Many become so accustomed to managing debt on a month-to-month basis, it becomes difficult to maintain a more holistic view of the debt scenario. This can lead to a situation in which debt slowly grows over time without notice, until something happens to bring the picture into sharp focus. At that point, many in California will question whether the time is right to file for personal bankruptcy.

One indication that bankruptcy might be the best course of action is when an individual's debt has exceeded his or her assets. Once this imbalance has been reached, it can be very difficult to turn matters around. When income is not sufficient to meet one's monthly payments, the time has come for a more aggressive form of debt relief.

Another sign that bankruptcy might be a good option comes after a round of creditor negotiations has failed. When a consumer has taken the initiative to contact creditors and ask for modifications of terms, yet those requests have gone unfulfilled, the only way to regain one's financial footing may be to file for bankruptcy. Once the bankruptcy process is underway, the assigned trustee will handle all future negotiations with creditors.

No one sets out with the goal to file for personal bankruptcy. However, life does not always fall in line with one's plans, and there are a number of scenarios in which a California resident might find the need to seek aggressive debt relief. In some cases, bankruptcy is the best possible option, and it can give consumers the ability to move beyond crippling levels of debt.

Source:, "3 Times Bankruptcy Is the Right Move", Dan Rafter, Nov. 9, 2015

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Thomas F. Miles, Attorney and Counselor at Law
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