Experiencing financial hardship is a really stressful situation and unfortunately, millions of individuals around the world end up in this position each day. People in this predicament have various options to recover from their financial distress, and bankruptcy should be regarded as a last resort when all other alternatives have been exhausted. You’ve most probably seen some of those debt consolidating companies promote their services on television for example. In a lot of cases, it can be overwhelming to try to figure out ways to recover from financial challenges, and many will file for bankruptcy simply because it appears to be the simplest way of doing so. But how do you know if bankruptcy is the right option for you? This article will shed some light into bankruptcy in order to help you determine if bankruptcy is the best option for your personal situation.
Bankruptcy has some rather severe financial implications: a bad credit history, increased difficulty in acquiring loans, and higher interest rates are just a few of these. So needless to say, bankruptcy should never be taken lightly. There are plenty of debt consolidating businesses that more than happy to assist you, which is similar to bankruptcy as all your debts are merged into one. This is normally considered a realistic alternative to bankruptcy as the financial penalties aren’t as severe. 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 position is in a critical condition and bankruptcy may be the best option for you.
If you don’t have any savings in your bank account and you’re confronting a mountain of debt, then bankruptcy may well be the best solution for you. Even if you have the ability to work a second job to increase your income, will this enable you to recover from your debts in the next 5 years? If no, then you should think of seeking professional advice about your situation, as bankruptcy can be an attractive alternative. Filing for bankruptcy will relieve you of these debts and while there are financial penalties, 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 quickly and you should really consider bankruptcy before your financial situation worsens. With no additional income, it can often take up to 30 years to settle your debts by making minimum repayments only, so all the interest you’ll be paying over these years can really amount to massive sums of money. While you’ll still be paying off debts with interest after filing for bankruptcy, typically you can negotiate better terms on conditions on your debts after declaring bankruptcy.
Debt Collectors Are Calling You
When you’re being frequently hassled by debt collectors on the phone and in the mail, it’s an indicator that your financial situation is worsening and you ought 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 feel that you aren’t in a situation to settle these debts in an acceptable time frame. This is a clear sign that you should honestly consider filing for bankruptcy as it’s probably the best solution for both your finances and your emotional well-being.
Even though there are some serious financial implications, bankruptcy isn’t the end of the world and in many cases, it’s the first step to financial freedom. When you’re facing 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 alternatives available to help you in financial hardship, if you’re experiencing any of the above 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 scenario, contact Bankruptcy Experts Darwin on 1300 795 575 or visit www.bankruptcyexpertsdarwin.com.au