Experiencing financial hardship is a particularly stressful situation and unfortunately, millions of people across the globe end up in this position every day. People in this situation have quite a few options to recover from their financial burdens, and bankruptcy should be thought of as a last resort when all other alternatives have been exhausted. You’ve probably seen a number of those debt consolidating companies offer their services on TV for example. In the majority of cases, it can be confusing to try to work out an effective way to recover from financial struggles, and many will resort to bankruptcy simply because it seems to be the simplest way of doing so. But how do you know if bankruptcy is the right choice for you? This article will shed some light into bankruptcy in order to help you figure out if bankruptcy is the best option for your personal circumstances.
Bankruptcy has some rather severe financial consequences: a bad credit history, increased difficulty in obtaining loans, and higher interest rates are just a number of these. So it goes without saying, bankruptcy should not be taken lightly. There are many debt consolidating companies that are happy to help, which is similar to bankruptcy as all your debts are combined into one. This is usually considered a viable alternative to bankruptcy as the financial penalties aren’t as extreme. But the best way to learn if bankruptcy is the best alternative for you is to ask for professional advice from bankruptcy experts. In the meantime, however, here are some signs that your financial situation is in a serious condition and bankruptcy may be the best alternative for you.
If you don’t have any savings in the bank and you’re dealing with a mountain of debt, then bankruptcy may well be the best option for you. Even if you are capable to work a second job to increase your cash flow, will this enable you to recover from your debts in the next five years? If no, then you really should look into seeking professional advice about your scenario, as bankruptcy can be a desirable alternative. Declaring bankruptcy will relieve you of these debts and while 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 intensify quickly and you should really consider bankruptcy before your financial issues decays further. With no supplementary income, it can often take up to 30 years to pay off your debts by making minimum repayments only, so all the interest you’ll be paying over this time can truly amount to large sums of money. Though you’ll still be repaying debts with interest after filing for bankruptcy, usually you can negotiate better terms on conditions on your debts after filing for bankruptcy.
Debt Collectors Are Calling You
When you’re being frequently hassled by debt collectors on the phone and in the mail, it’s an indicator that your financial condition is worsening and you need to make some changes. When you’re being contacted by debt collectors, it means that your creditors have sold your debts at highly discounted rates to debt collectors because they feel that you aren’t in a position to settle these debts in an acceptable period of time. This is a clear indication that you should seriously think about filing for bankruptcy as it’s quite likely the best option for both your finances and your psychological well-being.
Even though there are some serious financial implications, bankruptcy isn’t the end of the world and in many cases, it’s the first step to financial freedom. When you’re experiencing 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 determine what options you have. While there are many alternatives available to assist 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. Regardless, if you’re experiencing financial difficulties, it’s best to contact bankruptcy professionals sooner rather than later. For a confidential discussion regarding your financial circumstances, contact Bankruptcy Melbourne on 1300 879 867 or visit Insolvency Melbourne