Experiencing financial hardship is a particularly stressful situation and sadly, millions of individuals across the world find themselves in this position each year. Individuals in this situation have various options to recover from their financial problems, and bankruptcy should be thought of as a last resort when all other options have been exhausted. You’ve most probably seen several of those debt consolidating businesses offer their services on TV for example. In many cases, it can be confusing to try to figure out ways to recover from financial challenges, and many will turn to bankruptcy simply because it seems to be the simplest way of doing so. But how do you know if bankruptcy is the right alternative for you? This article will shed some light into bankruptcy in order to help you decide if bankruptcy is the best option for your specific circumstances.
Bankruptcy has some pretty severe financial implications: a bad credit history, increased difficulty in obtaining loans, and higher interest rates are just several of these. So needless to say, bankruptcy should never be taken lightly. There are plenty of debt consolidating companies that are happy to help, which is similar to bankruptcy as all your debts are merged into one. This is generally considered a good alternative to bankruptcy as the financial penalties aren’t as extreme. But the best way to determine if bankruptcy is the best option for you is to seek reliable advice from bankruptcy experts. In the meantime, however, here are some signs that your financial situation is in a critical condition and bankruptcy may be the best solution for you.
If you don’t have any savings in your bank account and you’re confronting a mountain of debt, then bankruptcy may well be the best option for you. Even if you’re able to work a second job to increase your cash flow, will this allow you to recover from your debts in the next five years? If no, then you really should think of seeking professional advice about your circumstance, as bankruptcy can be a desirable alternative. Declaring bankruptcy will relieve you of these debts and whilst there are financial penalties, it’s probably the best way to recover in this situation.
Making Minimum Repayments Only
If you can only afford to make the minimum repayments on your debts, then the interest on these debts will magnify rapidly and you should really consider bankruptcy before your financial issues worsens. Without any supplementary income, it can often take up to 30 years to settle your debts by making minimum repayments only, so all the interest you’ll be paying over these years can truly amount to large sums of money. While you’ll still be repaying debts with interest after filing for bankruptcy, commonly you can negotiate better terms on conditions on your debts after declaring bankruptcy.
Debt Collectors Are Calling You
When you’re being consistently hassled by debt collectors on the phone and in the mail, it’s an indicator that your financial situation is worsening and you ought to make some changes. When you’re being contacted by debt collectors, it means that your creditors have sold your debts at heavily discounted prices to debt collectors because they are convinced that you aren’t in a position to pay off these debts in an acceptable period of time. This is a clear indication that you should seriously consider filing for bankruptcy as it’s probably the best option for both your finances and your emotional well-being.
Whilst there are some severe financial consequences, bankruptcy isn’t the end of the world and in many cases, it’s the first step to financial freedom. When you’re being confronted by a mountain of debt and you can’t see any way of recovering in the near future, it’s time to seek professional advice to discover what options you have. While there are many alternatives available to help you in financial hardship, if you’re experiencing any of these warning signs then chances are that bankruptcy is the best alternative to ensure you and your family can secure a bright future. In any case, if you’re facing financial difficulties, it’s best to consult with bankruptcy professionals sooner rather than later. For a confidential discussion regarding your financial circumstances, contact Bankruptcy Experts Mildura on 1300 795 575 or visit www.bankruptcyexpertsmildura.com.au