Experiencing financial hardship is a pretty stressful situation and sadly, millions of people around the world end up in this situation each year. People in this situation have a number of options to recover from their financial issues, and bankruptcy should be considered as a last resort when all other options have been exhausted. You’ve possibly seen a couple of those debt consolidating companies advertise their services on television for example. In a lot of cases, it can be overwhelming to try to find out how to recover from financial struggles, and many will file for bankruptcy simply because it seems to be the easiest 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 figure out if bankruptcy is the best option for your personal circumstances.
Bankruptcy has some pretty serious financial consequences: a bad credit report, increased difficulty in securing loans, and higher interest rates are just several of these. So needless to say, bankruptcy should never be taken lightly. There are numerous debt consolidating companies that are happy to assist you, which is similar to bankruptcy as all your debts are merged into one. This is often considered a good alternative to bankruptcy as the financial penalties aren’t as extreme. But the best way to find out if bankruptcy is the best alternative for you is to seek professional 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 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 income, will this allow you to recover from your debts in the next five years? If no, then you really should consider seeking professional advice about your position, as bankruptcy can be a feasible alternative. Filing for 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 manage to make the minimum repayments on your debts, then the interest on these debts will compound rapidly and you should really consider bankruptcy before your financial situation decays further. Without any additional income, it can often take up to 30 years to repay your debts by making minimum repayments only, so all the interest you’ll be paying over these years can certainly amount to large sums of money. While you’ll still be paying off debts with interest after filing for bankruptcy, regularly you can arrange better terms on conditions on your debts after declaring bankruptcy.
Debt Collectors Are Calling You
When you’re being regularly hassled by debt collectors on the telephone and in the mail, it’s a sign that your financial condition is deteriorating 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 heavily discounted rates to debt collectors because they believe that you aren’t in a position to repay these debts in a reasonable period of time. This is a clear sign that you should seriously think about filing for bankruptcy as it’s most likely the best solution for both your finances and your emotional well-being.
Though 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 confronting 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 options 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 encountering financial difficulties, it’s best to contact bankruptcy professionals sooner rather than later. For a confidential discussion regarding your financial situation, contact Bankruptcy Experts Newcastle on 1300 795 575 or visit www.bankruptcyexpertsnewcastle.com.au