Debt Consolidation Help (Part I
of III)
This is part one of a three part series on debt consolidation
and bankruptcy.
When one is faced with overwhelming debt bankruptcy immediately
comes to mind. Usually the biggest decision at that point is
whether the file Chapter 7 or Chapter 13. In many ways
bankruptcy can be of benefit to a debtor who is in way over
their head. However, before turning to bankruptcy, one should
consider a debt consolidation instead.
When declaring bankruptcy there are several things you have to
keep in mind before you go through the process. If you have a
spouse and you have joint property to your filing bankruptcy on,
your spouse must also file or that debt will simply be
transferred to your spouse. If however your debts are kept
separate, you can file as a single person, and it will not
impact your spouse. However handling it this way, also leaves
any debt that your spouse has intact, which may not be the way
to go.
There is also the fact that with the bankruptcy not all debts
can be discharged. If you have student loans, taxes, alimony,
drunk driving debts, court costs, etc. none of these things will
be discharged when you have a bankruptcy. This means that you
may be able to wipe out your other debts, but you will still
have this debt and you will have a bankruptcy on your credit for
the next 7 to 10 years. Therefore a bankruptcy may not be the
simple solution that you might think it is.
Next time we will talk about various other options for handling
an overwhelming debt amount – such as how debt consolidation can
help you out.
SIGN UP
