Bankruptcy has gotten a bad rap. Credit card companies and banks will tell you all kinds of negative things about bankruptcy but they don’t care about helping you; they just don’t want you to take advantage of the laws Congress passed to help hard working Americans who have fallen into severe financial difficulties. So they will tell you to think about your credit and try to shame you into working out a payment plan that you probably can’t afford (or else you would have started those payments a long time ago, right?) Even if you can afford it, if you are dealing with credit card repayment, you need to think about how much of your payment is actually going to the principal, actually making a dent in the balance. Remember, a chunk of your payment will be going towards interest (and the interest on the interest- the “compound interest”). Can you really afford that?
But what about your credit? What about it? If you are talking to creditors instead of simply sending in a check when the bills come in, let’s face it, you are probably behind and your credit has already taken a hit. People who aren’t having money troubles have no reason to be negotiating with the creditors. Or perhaps you are current in your payments on everything but are really struggling to stay on top of things and are afraid that its just a matter of time before you start defaulting or sending payments in late (and incurring late fees). Late payments and missed payments can affect your credit terribly. Bankruptcy will of course, show up on your credit report but it shows that you are taking a positive step to fix your problems and get a fresh start financially. The old debts are no longer debts that you have to make payments on and it tells the world that rather than running from your bills, you’ve dealt with them honestly and legally through a bankruptcy, which can help your credit. There are also ways to start immediately rebuilding your credit after a bankruptcy whereas without one, you may never get that chance.
Don’t let your creditors tell you what you should be doing. They aren’t on your side. Consult instead with a Chicago area bankruptcy attorney who will be on your side and can give you an honest assessment about whether or not filing bankruptcy is a good solution for you. Located in Itasca and Schaumburg, O’Connor Cadiz Law can help you. Contact us for a confidential free consultation, before things get any more difficult.