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Bankruptcy - Extreme Debt Management
By
Jay Tillotson
Bankruptcy is a
scary word with a major stigma attached to
it, but the fact of the matter is, it can
help some people in certain circumstances.
If your debts are of an insurmountable level
and you genuinely cannot see another way
out, then you may have to go down this road.
Bankruptcy should only be considered if all
other avenues of debt management have been
exhausted. If you have tried consolidation
loans, refinancing your repayments and even
IVA's, to no avail, then this is the only
other option.
As a form of debt management, bankruptcy has
its advantages, although these are very few.
Once you have filed for bankruptcy, you can
have peace of mind that your debts will be
settled and after a year, usually you will
have a completely fresh start. It will also
keep your creditors happy so you don't have
to worry about any more payment demands.
Unfortunately, out of all the debt
management options, bankruptcy also carries
some of the biggest disadvantages. The one
which affects people the most is the loss of
assets. The majority of your assets -
including your home in most cases - are
seized to help in the repayment of your
debt, and you are only left with the
essentials and low-worth items such as basic
furniture, clothing, bedding and things you
may need for your employment like tools,
books etc.
You may also be subject to an Income
Payments Order, which means that a portion
of your income goes towards your creditors.
This usually happens if it is suspected you
may have a large portion of surplus income
after filing the bankruptcy.
Unlike other forms of debt management,
bankruptcy cannot be kept private. Details
of any people declared bankrupt is available
on the internet and your case may also
appear in your local paper. You are also
legally obligated to reveal your bankruptcy
if you are working or when applying for
jobs, which could go against you.
If it's at all possible to avoid bankruptcy,
do so. It should never be seen as an easy
way out of your debts.
Conclusion
Are you one
of the many that suffer from insurmountable
debt and wonder if bankruptcy is an option?
Give us a call at (203) 924-6700 or
contact us.
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