Bankruptcy has a bad reputation because of many mainstream misconceptions. Some of the misinformation has circulated for so long that people assume it to be true. You do not have to struggle with overwhelming debt payments when bankruptcy could help.
There are a few things you should know before you decide.
You may not lose your assets
Some people worry about filing for bankruptcy because they fear losing their house or their car. While you may have to liquidate some of your assets to repay creditors in certain filing situations, there are exclusions, including your primary home and vehicle. As long as you can keep up with those payments along with your bankruptcy settlement, they are not subject to seizure.
You have options
Filing for Chapter 7 bankruptcy is a common choice for those struggling to make ends meet. Chapter 7 eliminates any outstanding balances after the liquidation of assets and you meet your repayment schedule. However, some people cannot qualify for Chapter 7 because of resources or income limitations. Chapter 13 is an ideal solution in those cases.
With a Chapter 13 bankruptcy, you restructure your outstanding debts into manageable payments instead of eliminating them. There are fewer restrictions to qualify for Chapter 13 since you resolve your delinquent accounts through the payment schedule.
Consider the facts about bankruptcy before you eliminate the possibility. You might be able to get a fresh financial start with the right bankruptcy approach and a commitment to following through with the schedule. In addition, you can start rebuilding your credit almost immediately after the discharge.