A looming bankruptcy could be your worst nightmare. After all the planning and hard work, you have to face the fact that your business might not make it financially.
Your current accounts may be in arrears and your overdraft maxed out. You foresee that you might end up losing everything you have worked for. But all is not bad news. It is not the end of the world as everything is not what it seems.
You may be anxious that everybody will know that you have filed for bankruptcy. This is not true. There are so many people like you. You and your case will not be noticed by everyone.
What will affect you adversely is the fact that your self-confidence will be seriously compromised. It might take years before your self-esteem is what it has been before.
People believe that all their debts will be cleared away. There is, however, debt that will not be cleared. You will still be held responsible for child support, alimony and student loans.
Many people believe that they will never get credit again. It is not all that bad. You will be able to apply for loans, but at a higher rate than before. If you want to go and buy that car, it might be possible, but you will pay the price. You can even still apply for basic current accounts at several banks.
You are not to lose everything that you have ever worked for. As a matter of fact, many people keep most of what they had. You will still have your house and car and most of your current accounts, for instance. The laws differ from state to state but you will not walk out naked.
The general consensus is that the process of filing for bankruptcy is a difficult one. You can do it on your own if you wish to do so, although the assistance of an attorney will be a great help.
Once you have been declared bankrupt, you are not obligated to repay anyone even if you feel you would want to. This would be your conscience talking and not the law.
Don’t think that your credit rating will resurrect when all the debts have been discharged. Bankruptcy is the one thing you do not want to interrupt your credit score as it can stay with you for the next ten years.
If you think that you don’t have to repay back taxes anymore, think again. Unless it is tax bankruptcy, taxes will have to be paid. Most of the debt will be cleared, but some of your current accounts will remain your responsibility.
Some people plan to max out credit cards and believe that if they file for bankruptcy they will never pay for what they bought – just until the next judge cottons onto you and declares it fraud. Then you really have a problem.
If you believe that you can file for bankruptcy only once, rather stick to that notion, because even though you can file for bankruptcy again you will do your credit rating a lot of irreparable harm.
Make sure that you really have to file for bankruptcy. If you have exhausted all the possible avenues, then go ahead and do it.
Bankruptcy is not only for those who cannot make a business work. Other situations also force people to go bankrupt, such as when they get divorced or lose a job. They cannot keep up the payments and problems ensue.
Bankruptcy is not what anyone wants. It just so happens, that is the only option we have to stay alive and fight another day.