More people than ever before are staring down the barrel at bankruptcy. With American consumer debt reaching an all time high, and the volatility with the sub-prime mortgage industry many people are stuck with not many options to get debt relief. Most people feel bankruptcy is their only recourse to become debt free. In this brief article I will list some of the negative effects of going through a bankruptcy proceeding and offer an alternative credit card debt relief solution to filing for bankruptcy.
1. Most debtors going bankrupt get a feeling of being defeated and embarrassed. Your detailed financial affairs will be made available to the court and creditors.
2. You as the debtor do not have any say in how much you will be required to payback to the creditors, this decision is no longer yours but that of the judge.
3. You may lose valuable or prized assets, and may even lose your business, if you are a business owner.
4. Payments may be deducted from your paycheck for up to five years, which can be embarrassing at work.
5. Consumer debtors are required to attend credit counseling within 180 days of filing the petition for bankruptcy.
6. Debtors must also complete a personal financial management education before they can obtain a discharge.
7. A chapter 13 will remain on your credit report for seven years, and a chapter 7 for ten years.
While for some people bankruptcy will be the only option available, for many credit card debt settlement can be a much better option. Bankruptcy should be viewed as a last resort if nothing else can work. Debt settlement is by no means the magic cure and does come with its definitive pro’s and con’s, however for many people it is a savior from going into bankruptcy.
rate
email
print
link to this page
