When you are deep in debt, it can seem like there are no ways out. Your high-interest credit card balances spiraling out of control and calls from delinquent loans could make you crazy. Couple that with the flood of offers from debt relief companies and you could be pondering the big-B. But is bankruptcy for you? It’s an individual question and it is one which every person has to answer their own way. Here are a few things to consider about bankruptcy as a means to debt relief.Chapter 7:
- Bankruptcy stays on your credit report for 10 years.
- Bankruptcy for total liquidation of bills isn’t as easy to get as it used to be. If you have any major assets (home, car) those will very likely be sold to pay creditors. There is also a means test that you have to meet in order to qualify for Chapter 7.
- Bankruptcy takes several months to complete.
- Bankruptcy could cost upwards of $1,000 or more.
- This is more like a debt relief option. In chapter 13 bankruptcy you’re given an allowance for basic living needs when the rest of your money is dedicated to paying off your debts.
- Chapter 13 stays on your credit report for 7 years after the repayment period is completed.
- Chapter 13 costs somewhere in the range of $1500-$3000.
- Chapter 13 is preferable for people with assets as you’re a lot more likely able to keep your home or car.