Should I File Bankruptcy"Should I File Bankruptcy?" That's The Number One Bankruptcy QuestionThere are important things you need to consider before declaring personal bankruptcy. Bankruptcy is considered by some to be an easy way to remove a crushing burden of debt, but it's far from an easy way out. While it may relieve the debt burden, it has serious effects on your financial future and should always be the last option considered. Filing personal bankruptcy is relatively easy under current laws. But, as with any legal proceeding, the process is not without pain. To justify your filing, you will be required to expose your complete financial history to a judge and open it to objections by your creditors. Nothing in your financial life is left private! If you truly owe money to your creditors, they will not be pleased to settle for just ten cents on the dollar, or less. You can expect to hear strong objections and possibly have your name dragged through the mud. You will likely lose longtime friends and associates. Even if your filing proves successful, there are long-term impacts to your financial life that you need to consider carefully before embarking on such a drastic course of action. Long-Term Impacts of BankruptcyShould I file bankruptcy?You will immediately forfeit any credit cards that contain outstanding balances, and it's likely that other card companies will decide to close your accounts. Also, you will find it next to impossible to get mortgage loans after bankruptcy, or other lines of credit for that matter. If you do succeed in finding a willing lender, the interest rate charged will likely be sky-high and not helpful in your bankrupt situation. Buying a house after bankruptcy will also prove difficult, as will leasing or buying a new car. It will be difficult to obtain ANY kind of credit after bankruptcy. Be aware too that a bankruptcy filing does not cover all types of debts. Back taxes, student loans, and certain other debts are often exempt from bankruptcy protection, and the outstanding amounts of such loans are still considered due and payable. As well, besides the impact to your credit, you might be required to surrender real assets -- recreational vehicles, quality cameras, collectables, jewelry, and other items of redeemable value. Most courts will permit you to keep your primary residence and a car, but if you have a vacation property, or other secondary property, you may have to surrender it to pay off your creditors. And as can be expected, there is the cost of filing bankruptcy. Court costs and attorney fees do add up and must be paid, making an already bad financial situation even worse. Credit Repair After BankruptcyShould I file bankruptcy?Credit restrictions usually remain for up to ten years. During this period you will need to rebuild your credit history and to do this, you will have to maintain a near perfect credit record. It will not be easy! Bankruptcy is regarded by creditors as the most negative notation on any credit report. It's much worse than having a low FICO score. On the plus side, as long as all your creditors are properly notified, their debt collection efforts will cease, and your wages will not be garnished nor will foreclosure actions proceed. You will now have the chance to establish a new credit history, one that is better than your previous one. However, self credit repair after bankruptcy will prove difficult. Your bankruptcy credit report will cast its long shadow on all your financial dealings. Plus, you will not have access to new credit cards, but this might be a blessing in disguise. Until you can develop good spending habits and re-establish your credit history, it's probably best that you not have access to easy credit. Hitting Rock BottomShould I file bankruptcy?Bankruptcy can be a clear wake-up call to change bad financial habits. The truth is, some of us need to hit rock bottom before we decide to change our ways. The bad habits of a lifetime are not easily broken. It takes inner strength and strong motivation to implement long-term, positive changes, especially in money spending. Hitting rock bottom is extremely painful, though, and financial recovery can take a long time. Therefore, consider all the issues very carefully and look for a bankruptcy alternative. So you ask, "Should I file bankruptcy?" Answer: Only as a last resort! TOP of Should I File Bankruptcy RETURN to Eliminate Credit Card Debts HOME to Get The Best Credit Cards
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