11. How does debt settlement compare to bankruptcy? |
Filing for bankruptcy has many negative implications, and should be considered
only as a last resort. Bankruptcy may seem to be the quickest solution to removing
your outstanding debt and bankruptcy attorneys will tell you it will only remain
on your credit for 10 years.
Both Chapter 7 and Chapter 13 will represent a major negative mark on your credit
rating and will stay with you for the rest of your life. Chapter 7 bankruptcy
will stay on your report for 10 years and in the case of chapter 13 bankruptcy,
the clock does not start ticking to remove the bankruptcy mark from your credit
report until the chapter 13 bankruptcy plan is completed.
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Bankruptcy can cost up to $1,200 to file and additional attorney’s fees.
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In Chapter 13 bankruptcy you will typically have to pay back 80%-90% of your
debts plus legal fee’s.
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Bankruptcy may affect your ability to get a job.
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Bankruptcy will likely result in higher interest rates on future loans and credit.
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Carries a negative stigma, mental stress, and other burdens.
Bankruptcy is a legal proceeding that is entered into court records that will
never be deleted. Many loan applications, employment applications, insurance
applications, and other everyday forms ask "Have you ever filed for bankruptcy?" Even
if the bankruptcy has fallen off your credit report, to answer this question
untruthfully is considered a federal offense. Which means bankruptcy will follow
you for the rest of your life. If you are currently considering bankruptcy, speak with a Specialist at FH Financial so they can explain the consequences
and help you find other solutions that are not so permanent
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