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Facing Bankruptcy? Three Things You Need To Know
By
Julie Zorgo
In today's
economy, everyone hopes that they would
never face personal bankruptcy; however, it
is an unfortunate reality that many people
must deal with it every year. Perhaps you
are one of these people. Maybe you have lost
your job, or lost your house, or have gotten
into credit card debt above your head. Some
people are facing bankruptcy because of
medical bills that they are unable to pay.
If you fit into the category of facing
bankruptcy, or even if you are thinking
about or considering bankruptcy, here are
three things you need to know:
1. Facing bankruptcy is a life-altering
event. It can have a significant effect
on your family and on your own emotional
well-being. In some cases of bankruptcy, you
may be required to liquidate assets not
deemed necessary in order to help pay back
your debts. In any case, it negatively
impacts your credit score and greatly
hinders your ability to take out a loan or
borrow money even if you should need to.
Bankruptcy is not something to take lightly
or go into without fully analyzing all your
options.
2. There are alternatives to bankruptcy.
One option is to sell your house if you own
it, and pay off your debt. Another option is
to take out a home equity loan or line of
credit (basically borrowing money at a lower
interest rate against the value you have in
your house), to consolidate your debt. You
may also benefit from consumer credit
counseling or a debt consolidation loan (a
loan that allows you to combine all your
debts into one lower monthly payment). At
the very least, see a financial counselor or
advisor before filing for bankruptcy.
3. Consult an attorney and keep records
if you have to file for bankruptcy. This
is not something you want to do on your own.
Look for a qualified lawyer to help you
through the bankruptcy process, and keep
good records and files of every proceeding.
On a final note, if you are forced to file
for bankruptcy, you can move forward to
rebuild your credit. You can do your best to
learn to live debt free and to avoid making
any financial mistakes. There is always hope
for your future.
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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