Some people are so worried about all the consequences of filing for bankruptcy that they forget to look at the consequences of NOT filing bankruptcy. Obviously, every individual situation is unique and should be discussed in frank detail with one of our attorneys, the following information can help you make the decision whether a bankruptcy is the right solution for your financial situation.
Consequences of Not Filing Bankruptcy
Claims Secured by Your Home
If you have debt that is secured by your home a creditor cannot just take your home, but if you miss a few mortgage payments you may be looking at a foreclosure which will cause you to lose your home eventually.
Debt Secured by Your Vehicle
If your car is used as collateral on a debt and you are behind in payments your vehicle can be repossessed to pay off the debt. If you file for bankruptcy you could remove that debt through the courts.
Mounting Interest on Unsecured Loans
Unsecured debt, like credit cards, often carry high interest rates. The government now requires your credit cards to tell you how long you will be paying off the debt if you pay the minimum required amount, but few people actually read their entire credit statement. If you do, you’ll realize that this debt will continue for years and may in fact drag you further into a financial rut.
Peace of Mind
While many people feel uncomfortable about filing for bankruptcy, the relief they experience when their debts are erased will outweigh that discomfort. It also gives you a second chance financially where you get to start over with a clean slate and an important lesson learned.