I Am Under So Much Debt, Should I File Bankruptcy?

In this trying economic times, it is acceptable if you find yourself in some grave financial difficulties. If personal bankruptcy has crossed your mind, have you thought about talking to a bankruptcy lawyer to discuss all your available options? Seeking personal bankruptcy protection is your legal right and you should not feel embarrassed if this is your best option to achieve financial stability in the near future.In the last 2-3 years, you have heard stories of big corporations such as Bear Stearn and Lehman Brothers declaring bankruptcy. Individuals like you and I can file bankruptcy and there are essentially 2 flavors of personal bankruptcy. There is chapter 7 bankruptcy and also chapter 13 bankruptcy. A qualified bankruptcy lawyer can assist you clear up any question you have regarding chapter 7 bankruptcy versus chapter 13 bankruptcy. Since the passage of the amended bankruptcy law in 2005, it has become more difficult for an individual to file bankruptcy than before. In order to stop people from abusing the bankruptcy law, the US congress passed the new law in 2005. But if you are facing severe financial hardship, you should have no issue passing the assorted criteria to file for bankruptcy. The process to file bankruptcy protection is relatively easy and painless, but there are many implications that you should be made mindful of in advance. Here are some of the issues you will face after filing bankruptcy:Anticipate to have low credit score for extended period of timeAs part of the bankruptcy process, your credit score will be greatly affected as credit bureaus will fundamentally start your credit score near the minimum of 300. Since the credit score range is from 300 (worst) to 850 (best), you should have the mental readiness that you will be in the 300+ range. Credit score can be repaired over time so you should not get too despaired over it. Building your credit score back to the mid 600s or low 700s can take a few years if you are careful about taking care of your financial well-being. Here is a resource that can help you rebuild your credit score over time.For the next 10 years, your credit report will indicate you have filed for bankruptcyOne of the most lingering effects if you choose to file for bankruptcy is that your credit report will indicate this financial status for up to 10 years. Whenever you are applying for a job or a credit application, it inevitably will ask if you have filed for bankruptcy before. It never ask if you have filed bankruptcy in the last 10 years. So in essence, even though the bankruptcy record disappears from the credit history, it will never wholly disappear from your life.You can still maintain a lot of the assets that you own even if you filed for bankruptcyEven though the creditors have the right to reclaim your assets, there are definitely some assets that you own that are protected under the bankruptcy law. You are allowed to keep “exempt assets” when you have filed for bankruptcy which prevents the creditors from any repossession activities. Since it is such a crucial issue to retain as much assets as possible, you should consult your bankruptcy lawyer to get the maximum exemption possible. The act of filing bankruptcy is the easiest, but to come to the decision to file bankruptcy is perhaps the hardest one to make. This is a life changing event, and you should unquestionably not take this decision lightly. Filing bankruptcy should not be done in haste and you should consult a bankruptcy lawyer to gather all the facts before making the ultimate decision.

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