Filing for bankruptcy can offer the potential for a new financial future for people in New York struggling with the weight of insurmountable debt. Despite the potential benefits of bankruptcy, however, many individuals hesitate before filing. In some cases, people regard bankruptcy filings as a type of failure on a personal and financial level and thus may be hesitant to take that step. However, the consequences of waiting can cause someone to be in a far deeper financial hole from which to emerge.

According to one 2018 study, those who wait the longest to file for bankruptcy often struggle the most during the process. It can be more difficult for people who wait longer to file to recover from their financial situations, especially given the additional deterioration that can occur when a filing is postponed for years.

The term “sweatbox” is used to describe the period before people file for bankruptcy. This difficult time is often marked by a range of severe financial problems, including lawsuits and judgments over debts, the loss of major assets and struggles to meet basic needs like food and electricity. Many people who wait for two years or longer in this difficult period face much more severe financial situations when they do eventually file for bankruptcy.

For example, people who continue to struggle with debt for two years after they could have initially filed for bankruptcy have, on average, half of the assets of those who made the decision to file earlier. They also have a 40 percent worse ratio of debt to income than those who filed for bankruptcy earlier on in the process.

Filing for bankruptcy sooner rather than later can play a significant role in preventing further unnecessary financial pain. A bankruptcy attorney can work with people to find real debt relief and achieve a new financial start for the future.