Many people are frightened of bankruptcy, which is unfortunate. People aren’t afraid because bankruptcy is evil. In fact, filing for bankruptcy can be a financial savior for individuals. Some people are worried because myths and the evils of bankruptcy have been pushed for many years. Thus, citizens have been improperly educated or not educated at all.
In reality, bankruptcy isn’t for everybody with debt, but when it reaches a certain threshold and affects your life negatively, it’s time to consider a financial re-birth. This is what bankruptcy can offer.
Will your credit take a hit? Yes – between seven and ten years, depending on which bankruptcy option (Chapter 7 or Chapter 11 personal bankruptcy or Chapter 13 business bankruptcy), you are qualified to seek. But you can start rebuilding your credit within a few years by practicing sounds money management with a secured and self-funded credit card, among other options.
But how do you know when it’s time to consider bankruptcy? If a good portion or all of the events listed below have become a regular occurrence in your life, it’s time to at least look into debt-relief options.
- You are struggling to pay for necessities and essential bills.
- You are making minimum (or lower) on your high credit card debt.
- Taking out personal loans or using credit cards to pay for basic necessities.
- Ignoring your credit card debt and allowing interest to expand your debt even further.
- Debt collection agents are harassing you.
- Debt consolidation (Other than Chapter 13 consolidation) looks promising. It’s not.
- You begin receiving debt collection lawsuits.
- Your wages are garnished, or your bank account is frozen after a debt collector has won a lawsuit.
- You are facing home foreclosure for not paying your mortgage.
- You have exhausted your savings.
- You are just getting by and living paycheck to paycheck because most of your money is going toward repaying debts.
Debt doesn’t have to control your life. Bankruptcy is a possible solution that can provide you with a roadmap toward a new and educatee financial future.