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Since the Great Recession millions of Americans have found themselves in dire financial straits. While filing bankruptcy is often the last resort, many have been left with no other choice.

Bankruptcy can be a devastating move, both financially and psychologically. You are unable to borrow money or use a credit card. Your credit score may be lower than your age. But there is life after bankruptcy.

When the University of Arkansas School of Law set up a program for law students to work with consumers who have filed for bankruptcy protection, one fact quickly became clear. These consumers waited too long to act.

It s very sad, said Tim Tarvin, associate professor and supervising attorney in the student-staffed Federal Practice Clinic. It's not unusual for people to break down in the interview setting with the student attorneys who are representing them. These families have been working so hard trying to figure out how to pay off their debt, and it s just not working. The cash just doesn t flow. The money isn t there, and in most cases, it hasn t been there for a long time.

Tarvin cites statistics in The Two Income Trap, a book written by Harvard law professor Elizabeth Warren and published in 2003. According to Warren half of all bankrupt families were unwilling to admit, even in an anonymous survey, that they had filed for bankruptcy. She went on to say that as many as 18 million households compared to the 1.5 million that actually filed in 2003 would have seen a significant improvement in their balance sheets if they were only willing to sign a bankruptcy petition.

Why do people wait? Tarvin says is all comes down to shame. This single trait sometimes forces people to go underground, meaning they work for cash only, purchase with cash only and then cannot borrow money for any reason or even open a bank account. This usually comes after there has been some kind of legal judgment against them.

Very often and for whatever reason, there is tremendous shame, Tarvin says. For many of our clients, it s against the tenets of their religion.

He says it's part of the culture in the state to pay your debts and be self-reliant. When you can't meet those standards, it's hard to accept. Tarvin said he stresses that the real purpose of bankruptcy is not to punish the consumer, but to get them back on their feet and make them productive again. To accomplish that, he says, the consumer has to be willing to consider bankruptcy sooner, before their financial situation becomes even worse.

The real purpose of bankruptcy, according to Tarvin, is not to shame the debtor but rather to simply determine whether he or she can pay. It is a process designed to determine whether the debtor can pay all debts and still have enough money for the basic necessities for living.

To blame bankruptcy for the debtor s insolvency and non-payment to the creditor is like blaming the coroner for the death, Tarvin says. He the coroner is simply pronouncing that the person is deceased. Likewise, a bankruptcy discharge issued by the judge is merely a determination that the debtor is financially unable to pay his debts.

In her book, Warren found that 87 percent of families with children cite only three reasons for bankruptcy: job loss, family breakup and medical problems. Bad investment and credit card overspending are included with all other reasons within the remaining 13 percent.

Tarvin admits that some clients who come into the federal clinic have reached a financial condition that necessitates bankruptcy because they were irresponsible with credit cards, but these people, he says, are a minority.

By far, individuals rather than businesses file the greater number of bankruptcies in federal courts each year. In there were nearly 1.6 million total filings. Only 3.5 percent of these were business filings.