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What Are The Advantages Of Avoiding Bankruptcy?
Shortly after the passage of the Bankruptcy Reform Act of 2005, also known as BAPCA, Bankruptcy filings fell to dramatic lows. Fast forward to the beginning of 2008 and bankruptcy filings started increasing to record levels. Business became good again for bankruptcy attorneys.
The problem with the rash of filings which continues through today, is that for those who qualify for in particular a Chapter 7 bankruptcy, which is, in large part, viewed as a “debt walkaway”, many consumers view a bankruptcy with far to casual an eye. Please lets get one thing straight. No debt walkaway is void of consequences.
The idea that a chapter 7 bankruptcy is a fresh start is not always true. In some cases there can be a liquidation of some assets to pay back part of the debt. Additionally, in today’s tight credit markets, the bankruptcy will be cause for paying much higher interest rates on a credit you may qualify for for some time to come. Also, you may actually be frozen out of some credit markets, not to mention, some jobs, as more and more employers look at credit reports as a screening device. What about housing? Possibility of being excluded from that dream apartment, especially, if the competition is significant.
Their is no question that for some, filing a bankruptcy is the only way out, however, it should in my opinion, always be the measure of last resort. Seeking the services if a good credit counselor is good as a first step, but be careful. Non-profits which are fine, but also very limited in the options they can point you to, as they are under legal constraints in terms of what solutions they can offer you. You really want to seek the advice of a credit counselor who is familiar with many debt solutions and the advantages and disadvantages of each potential solution. Non profits can only offer you debt management and budgeting as a solution. Whereas, a counselor not under these constraints may be able also to offer you Debt Settlement, Debt Management, budget counseling, and perhaps even an Alternative Debt Relief.
The bottom line is that it is possible, in many cases, to avoid a bankruptcy in a debt crises, and its longer term consequences. A debt settlement program coupled with a debt validation program can avoid a bankruptcy and help restore your credit report at the same time your debts are being dispensed with.
If you are interested in exploring your additional options, please feel free to contact us by visiting:American Debt Enders. or by calling 877-766-2465 for a free consultation.
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