When people are flooded with debts, and they see no way out of their situation, they start thinking bankruptcy could be the only possible solution towards a debt free life. Almost all debtors are not aware of two main points about bankruptcy:
- Bankruptcy is not a wise method for debt solution
- Bankruptcy brings noxious consequences, affecting financial and social status
Here is a list of the aforementioned noxious consequences:
1. A bankruptcy filing remains on a Credit Report for as long as 10 years, and it also stays on Court Records for as long as 20 years. Thanks to this, your chances of getting a loan and even a job again, will be minimal.
2. You can also lose valuable assets when filing for bankruptcy, or you have to pay the equivalent in money.
3. As we said before, your financial and social status will be deeply affected. People tend to loose faith upon someone who has filed for bankruptcy.
4. If a business owner files for bankruptcy, he will suffer the same consequences as any other person who has filed for bankruptcy. He will not qualify again for a business loan.
5. After declaring bankruptcy, your bank accounts will be closed, credit cards, and everything that has been bought on hired purchase, such as a car or a house will be returned to the owner.
People really need to understand how the bankruptcy process works in order to use it as a last resort, and not as an easy way out.
Not true about Bankruptcy
- Bankruptcy will not get rid of all of your debts. There are some debts that cannot be canceled, such as tax claims, alimony, child support, among others.
- Although bankruptcy relieves the pressure of debt, it still leaves so many consequences that it does not feel like a fresh start. Because of this, bankruptcy is considered a temporary relief.
- Bankruptcy laws are rigorous about including all your accounts. You will not be given the chance to hide any account from the bankruptcy process.
- Bankruptcy turns you into a debt free person at the cost of your assets, either by liquidating them or by putting you into a new payment plan.
http://www.articleson.com/Article/Bankruptcy-Not-As-a-Debt-Solution/29077
