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Michigan residents should know warning signs of bankruptcy

Many Michigan residents who find themselves in the office of a bankruptcy attorney may be in a state of shock, wondering how they wound up in their financial situation. For some, it may seem as if overnight a few missed bills here and there turned into insurmountable debt that requires some legal help in order to resolve.

However, according to one recent report, there are in fact several warnings of looming financial distress that a Michigan family or individual should heed. For example, even a few missed bills are a sign that a person is in serious financial distress. This is especially true when a person is even unable to pay secured loans like a mortgage or car payment. Another particularly prominent warning is the inability to pay even the minimum on a credit card.

With respect to credit cards, should a family discover that they have expended their entire line of credit on a card, they should strongly consider undertaking a financial overhaul. Maxed out credit cards, particularly when the cards are being used to float basic living expenses, are a sure sign that bankruptcy is imminent. On a related note, a person who must use a so-called "payday loan" or other high interest loan to meet his or her obligations is in financial trouble.

There are other warning signs as well, about which Michigan residents should be aware. While these warning signs may on the one hand prompt people to take steps to avoid bankruptcy, sometimes they can also serve as an impetus to get families thinking about undertaking a carefully considered and well planned bankruptcy that can maximize the chances of a family getting the most debt relief possible.

Source: azcentral.com, "7 warning signs you're heading toward bankruptcy," Russ Wiles, Aug. 4, 2014

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