What do you lose if you declare bankruptcy? In terms of the American family, it’s not very much. The problem is that so many people make the mistake of thinking that filing bankruptcy automatically means a complete wipe out. The truth is that a good portion of your assets will be protected through a chapter 13 bankruptcy. The problem is that most people file for bankruptcy without taking this step and then face a very difficult period of rebuilding their financial situation.
What do you lose if you declare bankruptcy? Some of your most valuable assets will be at risk. Your car and house may be repossessed, while your bank accounts could be garnished or sold. You may also be forced to service a large loan repayment with lower monthly payments, which will affect your future ability to make these payments.
What do you lose if you declare bankruptcy if your credit is already in trouble? If you’re behind on your mortgage, car payment, or any other type of payment, a chapter 13 bankruptcy will definitely have a negative impact on your credit. It will be almost impossible to reestablish credit as you have a record of filing Chapter Seven all the time. This will affect not only your personal finances, but your ability to get any type of financing such as a car loan or home mortgage. You may also find that any type of credit you’ve previously had is gone forever.
What do you lose if you declare bankruptcy if you’re already struggling with your debt? You’ll be able to qualify for a debt consolidation loan, which can help you work your way out of debt. Keep in mind though that the interest rates for this type of loan are usually high and annual fees are often included. It’s also important to remember that you’ll have to pay off the entire amount of the loan plus any accumulated interest by the time you finish paying your balance. In some cases, this may not be a viable option as you could easily be swimming in debt and unable to see an end in sight. If this does happen however, there are many non-profit debt consolidation organizations that can help you get a loan in order to avoid bankruptcy.
What do you lose if you declare bankruptcy if your credit is already poor? Your credit is still intact and it’s important to rebuild it if you want to stay on top of your financial obligations. You may be able to secure a personal loan from a lender if your credit has suffered quite a bit. Lenders aren’t too fond of to see bankruptcy on someone’s credit report so don’t expect to walk into the lender’s office and expect a blank check.
What do you lose if you declare bankruptcy if you’re already out of money? If you’re struggling to make your mortgage payment or your utilities bill each month, then there may be no other alternative than to declare bankruptcy. While you’ll have to come up with the full amount of your obligation, you won’t be making any more credit card or loan payments. It will definitely keep your credit rating from getting worse but for most people, their credit rating has already suffered enough.
What do you lose if you’re unable to pay back a loan on a credit card or other debt? Again, this will affect your credit and most lenders won’t provide another line of credit. If you own a home, there may be equity in it that you can apply to. It’s best to discuss this with a specialist before deciding what do you lose if you declare bankruptcy.
These are just some of the consequences that are possible if you declare bankruptcy. Of course, there could be many more. Talk to a Maui bankruptcy attorney if you want to know more. They’ll be able to give you more in-depth answers to what do you lose if you declare bankruptcy. Don’t put yourself in a difficult situation where you risk losing your home, your car, or anything else that you think you may need.