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If we live long enough, all of us will face money issues at some point. All too often, declaring bankruptcy may seem like a viable option. After all, corporations do it, so why shouldn’t the typical member of society file Chapter 13 as well? Thankfully, there are a wide variety of options that can keep the private citizen from taking that drastic step and ruining his/her credit rating. Before taking that step towards bankruptcy, it is beneficial to consider all of your options.
Consequences of Bankruptcy
Those who advocate that you file for bankruptcy often won’t tell you about the potentially terrifying consequences of taking this action. They want to make it seem painless and easy, and they will often downplay the ill effects. However, if you do go the route of bankruptcy, it is essential that you understand what you will be facing.
- It will appear on your credit report for years to come–as much as seven to ten years.
- It goes on the public domain record and will be available in court records to banks, employers, and more.
- It does not automatically erase ALL of your debt.
- It is expensive to file for bankruptcy.
- It will keep you from finding a quality home loan in the near future.
- It will keep you from acquiring good credit cards.
- Missed payments after filing can be even more disastrous.
Because of these risks of filing Chapter 7 or 13, it is a good idea to research viable alternatives to bankruptcy. More often than not, after exploring the options that are out there, you will think twice before seeing that attorney about filing for bankruptcy.
Alternatives To Bankruptcy With Trout Associates
- One of the best alternatives out there is debt settlement. Most companies would prefer negotiating with the individual in order to set up some concrete way of reducing the amount of debt that is owed. Without a doubt, companies would prefer receiving a portion of their money rather than essentially receiving nothing in a bankruptcy case. It would be wise for the consumer to seek out reputable debt settlement agencies to aid them in this negotiation process.
- If you don’t feel comfortable dealing with your creditors, you may consider the option of credit counseling. The entire aim of a credit counseling agency is to avoid bankruptcy if at all possible. In this situation, the credit counselor will negotiate with the companies who are owed money to reduce the amount of interest that is charged and set up a workable repayment plan.
- Finally, if neither of these options is practical, debt consolidation may be the alternative to pursue. The positives of this option are that your outstanding debts are consolidated into one manageable payment per month. Furthermore, this should reduce the burden of potentially crippling interest that you have been paying each month.
In conclusion, don’t be too hasty when it comes to filing for bankruptcy. By taking the time to do your own research and consult with reputable firms and agencies that specialize in debt reduction, you may be pleasantly surprised to discover that avoiding bankruptcy may be an easier and more lucrative possibility than first thought.
