The Reasons to Avoid Bankruptcy

When it comes to making major amendments in our personal finances owing to debts,

bankruptcy is certainly not a quick fix solution. Recession has wreaked havoc on the lives of

Americans with severe health manifestations such as anxiety and stress. But it is in the best

interest of the consumer to opt for other alternatives such as debt settlement and debt

consolidation to get out of their debt worries. In this article, let us talk in details about the

reasons for avoiding bankruptcy to wipe off our debts and remove our financial woes.

§ The very first reason to avoid bankruptcy is that you cannot wipe off all your debts

which can make your finances go haywire.

§ Bankruptcy will necessarily stay on your credit report for the next 7-10 years. You

will not be treated in the same way as before, and it will be more difficult for you to

seek a mortgage loan in the near future. Your credit will be affected so badly that it

will be a hard time before you can obtain another credit.

§ It can also have a long lasting effect on your personal relationships, for when an

individual decides to file for bankruptcy the entire household has to move through a

rough weather. Instead of going out to spend time with your family you will end up

visiting the attorney and accompany him for all trials and hearings. In US, more

particularly there have been umpteen numbers of cases of marital break downs due

to bankruptcy. More so, after filing bankruptcy many individuals experience more

strain in personal relationships.

§ Bankruptcy filing can be expensive because it is unlikely that you will be able to carry

on with the bankruptcy procedures and attorneys are going to charge you a lot, and

if you do not use an attorney, chances are that you will fall back severely with your

huge payments, which you may never be able to repay.

It is clear therefore that all consumers should try to avoid bankruptcy for, if your assets

are not enough to repay your debts the creditors can consider selling your property to

cover up for your debts. Other than that, bankruptcy can cause irreparable damage to

your financial wealth. The fact that bankruptcy is a public document can prove to be a

constant source of embarrassment. A majority of people fail to realise that they do not

need to file for bankruptcy in order to get out of their financial mess. According to the

new laws of bankruptcy, a consumer needs to go through a means test before deciding

to file for one. It is more important that the consumer is more organized with his

finances and begins with a monthly pay off plan for the debts. The most difficult part of

debts is not to believe that you are in trouble. This can help you to simplify your debts

and avoid bankruptcy.