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Filing for bankruptcy is an extreme move and definitely not a fast fix. It's an extended, painful proceeding with a major impact on your social standing and you're unlikely to be able to get any kind of credit for up to ten years afterwards. Even so bankruptcies are rising. Out of stupidity or ignorance more people seem to be using bankruptcy as a prime way out, instead of a final resort. Before you consider it, be sure to examine alternatives. Try To Reorganise Your Debt If you haven't tried debt consolidation or negotiation, you truly ought. Sure, you'll have to pay back your debts in due course, but surely that's better than bankruptcy, isn't it? Sell What You Can It's much better to sell everything you own than it is to enter bankruptcy. Make a move to a smaller home. Sell your cars and catch the bus. Take a big, strong look at your life, and realise that there are only a few true 'basics', you can do without nearly everything. Your home is probably full of a number of valuable possessions that you hardly ever use, so bite the bullet and be shut of them. Sell them! In simple terms, deduct your debt payments from your income and live the lifestyle of someone who earns that much. You are bound to lose almost everything you own if you enter bankruptcy, so you may as well try to sell it yourself at a good price and avoid the bankruptcy issue altogether. Work More Hours Can you take extra time at work? Then do it. Going bankrupt is such an humiliation that you should at least try speaking to your boss and asking for a promotion or pay rise. The worst they can do is say no. If you declare bankruptcy they're going to find out soon enough about it anyway and they may be curious as to why you didn't come and ask for their help. If you're married and only one of you works, try to get a job for your partner you never know, they may end up enjoying it! Utilize Powerful Threats As a final resort one of the best things to do when you're considering bankruptcy is to write a letter to absolutely everyone you owe cash to, to let them know. Make it an extremely clear threat - 'if I can't find a way to pay my debts then I am going to be pushed to file for bankruptcy'. Almost all creditors would rather let you pay back a tiny part of what you owe than rather than have to try to get cash out of you after bankruptcy. Understand Your Local Bankruptcy Laws The Law for bankruptcy varies massively across the world. A number of countries will force you to give up everything you own to pay your creditors, in other countries you will at least get to retain your house and still other places you can declare yourself bankrupt without any detrimental effect! Speak to a Lawyer! You may believe you can't afford one, but many are willing to work for free for those who really need a lawyer but are unable to pay.
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