4 People You Need to Talk to Before You Declare Bankruptcy
One of the biggest steps you can take regarding your finances is declaring bankruptcy. Doing so can conceivably help free you from the burden of massive debt. However, declaring bankruptcy can also result in serious consequences as well.
It’s not something you should do haphazardly. With that in mind, below are four people you need to talk to before you declare bankruptcy.
Your Creditors
One group of people you certainly need to talk to before you declare bankruptcy is your creditors.
You may fear or even detest your creditors. However, their main goal is to get the money that they lent to you back.
If you declare bankruptcy, that may become impossible for them.
Discuss if there is any way you can change how you are paying your bills so you can better handle the financial burden.
It’s at least worth a shot. Sometimes, especially in the case of medical bills, the fact that you are willing to work with them on a payment plan can go a long way in your favor.
Most creditors would much rather get some of their money back than none of it.
A Debt Counselor
If your creditors are resistant to negotiating with you, you still have other options.
For one, you could seek out a debt counseling service. Such a service can help you create a debt management plan that could allow you to better pay off your debt over time.
They will negotiate with your creditors on your behalf to help formulate the plan.
This is a good idea especially if you don’t want a bankruptcy on your credit history.
An Attorney
Another person you should absolutely talk to before you declare bankruptcy is an attorney.
While declaring bankruptcy isn’t inherently a bad thing, and doing so can save you financially, it is a very technical legal process.
You may not actually qualify for the kind of bankruptcy you want, and that can have huge repercussions for your future.
You should find attorneys in your area that can help you make this determination.
You should also seek out lawyers with experience in asset protection.
Much of what you own could end up liquidated during certain kinds of bankruptcies if you don’t take steps to protect those assets.
Your Spouse
Bankruptcies can have huge consequences for your family.
With a bankruptcy on your credit history, you may be denied when trying to obtain a significantly sized loan for something like a house or car.
In other circumstances, a good deal of your assets may end up being used to pay off creditors.
Discuss all these possibilities with your spouse and family when you are considering declaring bankruptcy.
A bankruptcy can alter your life for years and even decades into the future.
It can also be a way to free you from a crushing amount of debt. Don’t rush through the process.
Try to do as much research as possible and talk with professionals about your plan.
Category: Bankruptcy
