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File Bankruptcy - Not So Fast!

Bankruptcy Will Not Change Your Habits.

Filling for bankruptcy is a quick fix that will not solve your long term financial problems. Controlling your spending habits and carefully managing your personal finances is what you need to do to solve your long term financial problems. One of the worst things you can have is financial problems that negatively impact your credit rating after filing bankruptcy.

Bankruptcy May Not Leave You Debt Free

Filing for bankruptcy does not necessarily wipe out all your debt. Some debt cannot be discharged by filling bankruptcy. Generally student loans, court ordered child support, alimony, and some taxes will not be eliminated by filling bankruptcy. Also, any debt incurred through fraud will not be discharged by filing bankruptcy.

Bankruptcy Can Be Costly

The attorney fees and other costs associated with filing bankruptcy may not be the only price you'll pay. Depending on the type of bankruptcy (the chapter) you file, the fact that you filed bankruptcy will stay on your credit report for seven to ten years. This will make it very difficult for you to get any kind of a loan at favorable terms. If you are able to secure a loan expect to pay a much higher interest rate than you would normally pay.

Bankruptcy Only Affects Your Credit

False Filing bankruptcy can affect your ability to rent an apartment. It may affect your ability to obtain affordable insurance. It may also affect your employment. Depending on your line of work it may affect your ability to secure employment or your eligibility for promotions. Then you also have to consider the emotional side of filing bankruptcy. For many individuals filing bankruptcy can result in a great amount emotional distress and embarrassment. The feelings of guilt and stress may last for many years, surfacing again every time you try to secure a loan.

Summary

This article is not meant to persuade you one way or the other. Our attempt here is only to open your eyes to the fact that there are many things to consider before making the decision to file bankruptcy. Obviously the final decision whether to file bankruptcy is up to you.

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