Credit Ratings – The Cost Of Declaring Bankruptcy
When I declared bankruptcy I was shocked to find out that it would cost me over $2000 dollars to do it, but it did. I think the actual number was $2200 when I was all done and processed by the trustee.
I can’t tell you the relief I felt when I went to the law offices and spoke with my trustee. She had declared bankruptcy herself two times which I thought was ironic for sure. She sat at her desk a fully trained professional, with her money problems behind her, so that gave me hope. Knowing that I was not the “scum-bag” the collections people tried to convince me I was, was a massive sense of relief. Money can be a nasty game, when a large corporation wants to squeeze it out of a consumer.
The only thing I regreted about declaring personal bankruptcy was that I had not done it earlier. To have a fresh start is fantastic, but of course we all know there is a big price to pay. That price is living with no credit rating for 6-7 years. What you do with those 7 years is adjust your lifestyle and learn the art of financial responsibilty. You should be looking at all aspects of your personal finances, spending habits, earning capability, and of course who you are living with. I can’t stress the importance of staying away from living partners, or spouses that are running your household into the money pit.
It may seem like a jail sentence when you first declare bankrupcty, but you will soon learn that life is certainly not over. I remember the stress of being overwhelmed with debt, and financial pressure. It can begin to consume you if you don’t keep things in perspective, I suggest you learn to either deal with stress really well, or learn to face the fact that you are going to be declaring personal bankruptcy.
What you will notice when you finally visit that lawyer or trustee, is that the sidewalks still except your shoes, the sky is still blue and the clouds still roll in and out. The library still allows you to take out books, your friends don’t dump you, your dog still loves you, and life is not over. If you are presently considering bankruptcy, be sure to go talk it over with a good lawyer first. There may be ways to avert bankruptcy….and if you can – great!
You can avoid personal bankruptcy by using a law office to negotiate a settlement with all your debtors. Usually a percentage on the dollar is offered, and paid back over time. I would try that first before going bankrupt. You should only consider full bankrupcty if you realize that you will never earn your way out of the interest payments that are mounting. Keep in mind that each law office, trustee, bank, bank manager, credit card company, or creditor is different – you will have a slightly different experience than I did.
One thing I would do before declaring bankrupcty is make sure you can be discharged as soon as possible after the ink has dried on your bankrupcty documents. For example; credit card debt is usually the quickest kind of debt to be discharged from. So look into all your debts and try to pay off as many of your creditors as you can before you pull the plug and declare the big B. The shorter your list of creditors, the easier it will be for the trustee to get you discharged from bankruptcy. You still have to wait 6-7 years for your bankruptcy to be off the books with the credit bureaus, but as I mentioned above, your life is not over. In many ways it’s just begun.
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