Is Bankruptcy My Best Option? How To Know If Bankruptcy Is Right For You

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Bankruptcy,Bankruptcy Advice,Insolvency

Going through financial hardship is a particularly stressful situation and sadly, millions of people around the world find themselves in this position each day. Individuals in this situation have many options to recover from their financial problems, and bankruptcy should be thought of as a last resort when all other options have been exhausted. You’ve quite possibly seen several of those debt consolidating businesses advertise their services on television for example. Often, it can be overwhelming to try to work out the best way to recover from financial challenges, and many will declare bankruptcy simply because it seems the simplest way of doing so. But how do you know if bankruptcy is the right choice for you? This article will shed some light into bankruptcy to help you determine if bankruptcy is the best option for your personal circumstances.

Bankruptcy has some pretty serious financial consequences: a bad credit report, increased difficulty in acquiring loans, and higher interest rates are just some of these. So it goes without saying, bankruptcy shouldn’t be taken lightly. There are a lot of debt consolidating businesses that more than happy to assist you, which is similar to bankruptcy as all your debts are combined into one. This is normally considered a sensible alternative to bankruptcy as the financial penalties aren’t as extreme. But the best way to determine if bankruptcy is the best option for you is to ask for reliable advice from bankruptcy experts. In the meantime, however, here are some signs that your financial situation is in a critical condition and bankruptcy may be the best solution for you.

No Savings

If you don’t have any money in the bank and you’re facing a mountain of debt, then bankruptcy may well be the best solution for you. Even if you have the opportunity to work a second job to increase your cash flow, will this enable you to recover from your debts in the next 5 years? If no, then you should consider seeking professional advice about your condition, as bankruptcy can be a desirable alternative. Declaring bankruptcy will relieve you of these debts and while there are financial repercussions, it’s probably the best way to recover in this situation.

Making Minimum Repayments Only

If you can only manage to make the minimum repayments on your debts, then the interest on these debts will magnify rapidly and you should really consider bankruptcy before your financial situation gets worse. Without any additional income, it can sometimes take up to 30 years to repay your debts by making minimum repayments only, so all the interest you’ll be paying over this time can certainly amount to enormous sums of money. Although you’ll still be paying off debts with interest after filing for bankruptcy, normally you can arrange better terms on conditions on your debts after filing for bankruptcy.

Debt Collectors Are Calling You

When you’re being continually hassled by debt collectors on the telephone and in the mail, it’s an indicator that your financial position is deteriorating and you have to make some changes. When you’re being contacted by debt collectors, it means that your creditors have sold your debts at heavily discounted prices to debt collectors because they are convinced that you aren’t in a situation to repay these debts in a reasonable period of time. This is a clear sign that you should honestly consider declaring bankruptcy as it’s most likely the best option for both your finances and your emotional well-being.

Although there are some serious financial repercussions, bankruptcy isn’t the end of the world and in most cases, it’s the first step to financial freedom. When you’re encountering a mountain of debt and you can’t see any way of recovering in the near future, it’s time to seek professional advice to identify what options you have. While there are many options available to assist you in financial hardship, if you’re familiar with any of these warning signs then chances are that bankruptcy is the best alternative to ensure you and your family can secure a bright future. Regardless, if you’re encountering financial difficulties, it’s best to contact bankruptcy professionals sooner rather than later. For a confidential discussion concerning your financial circumstances, contact Bankruptcy Advice Perth on 1300 879 867 or visit www.bankruptcy-advice.com.au/perth

 

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