I wrote earlier when you do NOT need the services of your friendly local bankruptcy attorney. It's a big decision, and not something you should lightly jump into. However, there are certain situations when you absolutely do need to speak to one, and failing to do so can lead to the loss of your bank account, car, or even worse, your home.
There are generally four times when you really, really need to reach out to an experienced attorney for help.
1. You're facing foreclosure on your home
This is not the time to hire a cut-rate attorney just 6 months out of school. Foreclosure law varies greatly by state, so it is hard to make generalities about the process. However, in most cases, a bankruptcy attorney can file a Chapter 13 bankruptcy and save your home. Given the hard deadlines in foreclosure and sheriff sales of properties, you should speak with an attorney as soon as possible when you are served with a foreclosure notice. The bankruptcy "automatic stay" stops creditor actions (like foreclosure) immediately, but you are putting yourself and your home at great risk by waiting until the last minute.
2. Your car is being repossessed
If your car is your only means to get to work, losing it can be devastating. Don't wait until the last second. It is sometimes not practical to keep a home in foreclosure or a car in repossession, and an honest attorney should tell you as much. However, I have found that cars can be saved in most cases -- as long as the individual has steady income going forward. Since temporary job loss is a frequent cause of car repossession, this is a tricky situation.
3. You aren't making any progress with your debts
Another less dramatic scenario where you need to strongly consider bankruptcy is when you cannot get your credit card balances to budge. Sky-high interest rates can sometimes make paying your balance down impossible, even while you are paying several hundred dollars or more every month. Honestly assess your future prospects: Are you paying as much as you can? Is your pay at work pretty stagnant? Do you have a kid on the way? Will student loans come due? Are more medical bills in your near future? If you're answering "yes" to these questions, an attorney can help you out.
4. You've been sued by a creditor
If you have been sued by a credit card company, you will need to consult with an attorney to find out the laws in your state. In some states, creditors can attach and seize property, such as homes, cars, bank accounts, and personal items. In some states, they can even attach wages. A good bankruptcy attorney will know these laws and will instruct you on when your next steps should be.
If you are facing any of these scenarios, you can't let pride or wishful thinking cloud your judgment. Do your research and find an experienced bankruptcy attorney right away.