There is a myth about bankruptcy that once a person declares bankruptcy he gets a chance to start all over again in a fresh way. However the truth is much more harsh than the myth.
Bankruptcy in reality is a torrid and devastating event which actually leaves a person with irreparable damage. The word "Bankruptcy" might chill up spines and come as a viable option when things go from bad to worse.Any individual who is facing the prospect of bankruptcy must re-think over it again as it would be living a nightmare, once bankruptcy is filed.
Why is it advisable to avoid bankruptcy ?
Filing a bankruptcy is not smart move neither it should be recommended. It is something which leaves you with no scope of improvement once you declare you are a bankrupt. In most cases family life is distressed and a dark future awaits.
Bankruptcy is listed as "one of the five most life-changing negative events" along with divorce, severe disability , illness and losing a loved one. You need to make sure that you are not being fooled, when your lawyer(s) advise you to file bankruptcy, as the consequences are an extreme.
Types of bankruptcy:-
1. Chapter 7 Bankruptcy is absolute bankruptcy where the credit report is affected over the next 10 years.
2. Chapter 13 Bankruptcy is a similar to a modified repayment plan in which exists on the credit report for the next 7 years.
However, whichever form of bankruptcy you may go for , shall be a major a form of discomfort wherever you go for jobs or loans. It is inquired everywhere whether an individual has ever filed a bankruptcy or not. If someone lies in order to get a loan, then it is considered as a criminal fraud.
Bankruptcy can be avoided with proper credit counseling. Debt consolidation is also a very sensible alternative. A quicker win over through bankruptcy is actually a loss of a life-time.
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