Wealth-Coaching

When you are in debt to the point that you are constantly behind and unable to make your payments it can feel overwhelming to say the least.

Often times the burden of indebtedness seems impossible to overcome outside of bankruptcy.  If you are considering bankruptcy to eliminate your debt, consider these options before making that decision.

• What is your total indebtedness?  Is it more than you could ever pay back even if there was no interest on the debt?  Take the total debt and divide it over 5 to 7 years and see what the annual and monthly total would be if you had to make a payment.  If this is something that you could do without losing everything, try a debt reduction plan instead of bankruptcy.
• Are you extremely late on your payments?  If you are, then consider debt counseling or consolidation, if you are not then bankruptcy is not an option on those debts.
• What is the reason for your financial problems?  Did you over spend, charge too much to cards, or have you had a financial hardship or change in your income?  The courts are not to happy with someone who just charges up more than they could ever pay back.  New bankruptcy laws protect new accounts from being thrown into a bankruptcy.

Bankruptcy should be your absolute last option when everything else is considered.  If you have equity in automobiles or homes you are not going to qualify to file. 

Sometimes the courts could require you to liquidate your assets and even your retirement savings before allowing you to file bankruptcy.