Legal

Major Causes Of Bankruptcy

Bankruptcy is a state or a condition by which a person or an entity is unable to pay or clear their debts within the agreed duration. Under such conditions, the person or the entity have an option to visit a court of law and file for bankruptcy. The move will help them to eliminate debts and some liabilities and give them an opportunity to reorganize themselves with peace. For the court to approve the bankruptcy application, there has to be a valid reason. There are plenty of bankruptcy lawyers in San Diego, California. These lawyers are all highly qualified, and well versed in solving bankruptcy issues.

bankruptcy-law

  • Medical expenses are the leading cause of bankruptcy in San Diego, California. Most of the cases where medical expenses lead to bankruptcy, 78% of them people had a health insurance.
  • Job loss is the second cause to bankruptcy. People who lose jobs in most cases file for bankruptcy. The reason behind this is that they have more liabilities than the money owing in.
  • Uncontrolled spending also leads to bankruptcy. Poor financial management makes people fail to meet their liabilities and eventually they go bankrupt.
  • Divorce is another leading cause of bankruptcy. It is estimated that over 50% of American who divorce later file for bankruptcy.

BU008116

  • Accidents or other unexpected disasters. In some instances people suffer from accidents and end up using all of their money to recuperate. At such instances, they are not in a good position to pay for their debts and their only solution left at hand is to file for bankruptcy.

Conclusion

There are hundreds of reasons that lead to bankruptcy, and the above are the major ones. If you are looking forward to file for bankruptcy, looking for a lawyer will improve the chances of your application getting approved. They will guide you through the process and ensure it is a success.

Most Popular

To Top