Your bills are adding up, and your creditors are calling you all through the day. The debts just seem to be overwhelming and you are at crossroads. At such times, bankrupcy seems to be the only way out. In fact, there are even commercials that try to convince you this is the way to go. Before you file your paperwork, take time and consider ways and means of avoiding bankrupcy. Bankrupcy is not some form of magical solution that will clear away all your problems. With a little diligence, you can avoid this nightmare called bankrupcy and save what is left of your credit history and probably your sanity.
Why you need to avoid bankrupcy:
Anyone filling for insolvency must have suffered a big financial hit. Should you file, expect your credit score to plummet by about 250 points. In addition, you will have black mart that will taint your report for up to 10 years. This will affect every transaction you are involved in the near future. You will not be able to receive any credit but if you manage to secure a loan; you will have to bear high interest rates. Purchasing a home or a car will not be easy for you. There are debts that bankrupcy does not cover. For instance, overdue tax, child support or debts to government are not covered. The best ways to avoid bankrupcy is by consolidating all your debts into one.
Even though you may be feeling like you are at the end of the rope, there is a way out for you. You can take control over you debts by getting organized. Take everything which has your name on it and sort them out. Have a list of all your debtors and categorize them into subcategories. Once you prepare this list, you will have a better perspective of the situation. Consolidating all your debts is a possible way to avoid bankrupcy. There are people who have done this and so can you.