According to Experian, consumer debt has risen 3% over last year, soaring well over the $1 trillion mark. With personal debt continuing to skyrocket, more and more consumers are turning to bankruptcy to ease their financial burden. For some, bankruptcy may be the right decision, but it’s not a decision to take lightly. It may sound like a quick fix to all your financial problems, but a bankruptcy can cause severe damage to your ability to obtain credit long into the future.
If you file for Chapter 7 bankruptcy, you’ll no longer be making monthly loan or credit card payments, which sounds good on the surface, unfortunately, there are also quite a few downsides. In bankruptcy, your credit cards will automatically be closed, if they haven’t already been closed by your creditors. Your access to credit will be almost entirely gone, and should an accident arise where you need money fast, you may be completely out of luck. Maybe your hot water heater has broken or you’ve been in an accident and you need to repair your car. After you go through bankruptcy, it’ll become extremely difficult to obtain credit, whether it be for a car loan or credit card. Even if you are able to get a loan, it’ll be at a substantially higher rate than if you hadn’t gone through bankruptcy. If you’re thinking of moving or starting a new job, consider holding off on filing for bankruptcy, as many employers and landlords look at credit reports in their decision making.
If you’re considering bankruptcy, it’s important to research the requirements and ramifications of filing for bankruptcy to determine whether it’s the right solution for your current financial situation as well as for your financial future.
Here are the top 3 articles from National Debt Relief from 2017 that’ll help you make the right choice:
1. How to Figure Out if Bankruptcy Is Your Only Option
Bankruptcy is not right for everyone. Consumers who file for bankruptcy risk a lot: the court may require the selling of assets to pay creditors, life insurance policies or pensions may suffer effects, and credit scores will likely plummet. This article is a great place to start if you’re considering bankruptcy. This overview explains what bankruptcy is, what the different types of bankruptcy are, what each type covers, and whether bankruptcy may be right for your individual situation. If you think bankruptcy may not be the right choice, this article also explains other options that you may have for getting control of your debt. Be sure to check out the full article.
2. Debt Settlement or Bankruptcy?
This article delves into the reasons you may have gotten into debt in the first place, which is important to understand before you decide whether filing bankruptcy is the right decision for you. It also explains the differences between bankruptcy and debt settlement, which is an alternative to bankruptcy for taking control of your debt. It might be a better option for you, so be sure to check out the entire article.
3. How Are Debt Consolidation Loans Handled in Bankruptcy?
If you’ve already entered into a debt consolidation loan but have made the decision to file for bankruptcy, can your consolidation loan be included in it? This article answers that question and more while focusing on debt consolidation loans and their handling in the bankruptcy process. To learn more, read the full article.
Most bankruptcy attorneys offer a free consultation to determine whether you qualify for bankruptcy protection, but arm yourself with knowledge before consulting with someone. Get a copy of your credit report so you have a full, detailed picture of your debt and standing. Use the referenced articles to get a full understanding of what bankruptcy is and what other options may work without such a detrimental hit on your credit.
The expert debt counselors at National Debt Relief can answer any questions you may have about taking control of your debt. Call us today at 1-800-300-9550 and see how we can help.