Bankruptcy as a Last Resort
historically high levels of consumer debt and many companies in
financial distress, the number of bankruptcy filings continues to
break records. Although bankruptcy may seem like the only
option for those with extensive debt, the disadvantages often
outweigh the benefits. Here
are some options to explore before taking the plunge.
a realistic repayment plan.
If you’re up-to-date on your bills and could repay what you
owe in three years or less, bankruptcy may not be necessary.
Cut your expenses and commit to paying off debt over time.
a payment plan with creditors.
Credit card companies faced with the rising number of
bankruptcy filings often prefer to collect some of what's owed
rather than none. You can conduct these negotiations on
your own, with the help of an attorney or through a credit
assets to pay off debts.
If you're a homeowner, consider a home equity loan. The
interest on these loans is tax deductible, as long as your
loan doesn't exceed the value of your home.
However, if you default on your loan, you could lose
your most valuable asset.
help from a financial expert.
A financial advisor or credit counselor can help you develop a
debt management plan to pay your creditors, as well as a
budget to help you avoid falling into the same trap again.
some situations, bankruptcy may be your last or only option. At
that point, delaying the inevitable can cost you more and possibly
prevent you from qualifying for the relief you could get by filing
before the reform law takes effect. Be sure to consult a
qualified financial advisor or credit counselor before taking
example provided for illustrative purposes only.
Does not take into account transactions fee's or expenses. Past performance does not guarantee future results.
This information is provided for informational purposes
only. The information
is intended to be generic in nature and should not be applied or
relied upon in any particular situation without the advice of your
tax, legal and/or your financial advisor.
The views expressed may not be suitable for every