Bankruptcy can be a really difficult decision to come to. It often takes a lot of struggle, consideration, and reality-checks to file for it, though once done, most people feel an immediate sense of relief for having done it. Filing for bankruptcy will certainly affect your credit, however, the most important tradeoff is the sense of being free. Yes, the climb back up will be hard, but not at all impossible. If you have considered filing for bankruptcy, but are not yet sure if it is the right move to make, consider discussing your predicament with a bankruptcy attorney who can assist you with their expertise and guidance.
If you would like to learn more about bankruptcy, here are the most important pros and cons to consider. These factors will offer a deeper look into your situation, allowing you to contemplate aspects and how they play into your finances.
Pros of Bankruptcy:
- Fast Process: The time it takes to complete a Chapter 7 bankruptcy is generally pretty fast; 3-6 months from the time you file. This means you waste less time getting your finances straight, and it’s less time you will have to wait to begin rebuilding your credit.
- You May Not Lose Everything: Exemptions exist that may enable you to keep certain items of property, including, quite possibly, your home.
- You Will be Able to Attain Credit in the Future: Though it may take 1-3 years, and it most likely comes with the catch of a high interest rate, you will still be able to get new lines of credit in the future.
- Peace of Mind: Most importantly, bankruptcy can give you a sense of peace of mind because it offers security and protections that keep aggressive collectors away. It also wipes out the stress of having to cover these debts, while giving you the chance to start over.
Cons of Bankruptcy:
- Your Credit: Most obviously, your credit will be wiped out, and the mark of your Chapter 7 bankruptcy will remain on your credit report for up to 10 years. You will lose credit cards, and very much the possibility of getting a new mortgage.
- Possessions: There is a very high chance you will lose any unnecessary, luxury possessions.
- Obligations Remain: Even if you can escape debt through filing for bankruptcy, you will still be obligated to pay child support, alimony, and your student loans.
- Stigma: Though not the worst thing to live with, for some people, this can be an emotionally difficult aspect of bankruptcy. However, stigma can be overcome, and if bankruptcy makes sense in every other way for you, it’s worth weighing your options.
While only you can decide what the best course of action for your situation may be, hopefully examining these pros and cons of bankruptcy has been beneficial in helping you determine whether or not bankruptcy is a viable option for you. If you are in the Livingston, New Jersey area, contact The Law Office of Stuart M. Nachbar to schedule a consultation on filing for bankruptcy. He offers many years of experience in this area of law and can assist you with every step of the process; from determining if bankruptcy makes sense for your situation, through its completion.
You can reach Stuart M. Nachbar, Esq. at:
The Law Office of Stuart M. Nachbar, P.C.
354 Eisenhower Pkwy, Plaza 1 Suite 2025
Livingston, New Jersey 07039