When you are neck deep in your debts and there are creditor’s threats looming and lurking around ready to take your assets and leave you with nothing, you may need to file personal bankruptcy to relieve yourself of these worries and compensate yourself from some financial losses.
By declaring yourself bankrupt, however, there are attached advantages and disadvantages to it. Filing bankruptcy will automatically stay your creditor’s collection effort through annoying phone calls, demand letters to pay debts, and some potential lawsuits. It will allow you to regain your credit and pay your debts in peace without embarrassing lawsuits. These are the advantages that you will gain when you file bankruptcy instead of being buried in debts and lawsuits. It will protect your properties from unsecured creditors and will likewise save your wages from being garnished.
Filing bankruptcy has also some negative effects on your part. A record of bankruptcy will be kept in your credit file for 7-10 years. You will also lose your credit cards and credit line. Any application for tax refund will be denied. You cannot obtain a mortgage or loan for quite some time and lose some of your assets. You cannot be made director of any limited liability company.
In filing bankruptcy, understand your options. Contact a lawyer who can answer your inquiries on this matter especially when you are about to lose your priceless possessions.