What Causes Debt that Leads to Bankruptcy?
While each individual situation may be different and needs to be individually assessed to determine whether bankruptcy is appropriate for the situation there are some common types of situations that lead to financial instability resulting in a need for bankruptcy. What follows are some common types of situations that may lead to financial problems: • Making purchases based on what you want rather than what you need. • Making large purchases that are beyond your current ability to pay for them. • Purchasing things under payment arrangements that call for high interest rates. • Purchasing items with a credit card that you cannot afford to pay for with cash. • Utilizing a credit card to pay on bills and/or bills due on other credit cards • Inattention to the interest rate that a credit card carries with it. • Spending beyond the credit limit set by an account and incurring charges for being over the limit. • Being late on paying your credit card causing late fees to be charged. • Paying o
