The strongest form of debt medicine and that’s
bankruptcy. There’s really two forms for consumers of bankruptcy, a chapter 7 which is a straight
liquidation. Your assets are liquidated and it is your court appointed trustee manages
the pay off and liquidation of all of your debts and then theres a chapter 11 for business,
a chapter 13 for consumers, where it’s a repayment plan, over about 5 years on average. You’re
repaying a bunch of your debts, including secured and unsecured. Now bankruptcy reform
went into effect, so make sure you evaluate. Can you qualify for a 7, which is where you
get the true benefits and liquidation. Or do you get forced into a chapter 13 program,
where you have to repay a portion of your debts over typically about 5 years with monthly
payments, again managed by a trustee? Very aggressive approach it devastates your credit
score. It can impact your ability to get employment, government jobs, leases. So it’s
something that should be seriously considered and typically it’s the last stop on all of
the debt relief alternative paths. Where if you can qualify for a refi loan, try that
first and then evaluate credit counseling or even debt settlement as bankruptcy alternatives.
But if you are really in financial hardship and can’t afford monthly payments, we definitely
advise you to seek council from a bankruptcy attorney. Ideally a local bankruptcy attorney
in your state, in your area. See what you qualify for, see what the options would look
like for you in your situation. Thanks for coming to Bills.com, we’re helping thousands
of people solve money problems every day.