Deciding to file for Chapter 7 bankruptcy can be one of the most difficult financial decisions someone can make. What if filing is a mistake? Do you have any other options? Is bankruptcy really that helpful, or will it take your already spiraling finances into a deeper pit? What will people say about you if they find out you filed for bankruptcy?
Chapter 7 bankruptcy can be a difficult thing to go through and the struggles can last for a long time. But there are some real positives to the process that can help you emerge stronger than before. Here is a list of some of the pros and cons of Chapter 7 bankruptcy.
- Pro: The process of filing takes only 3-6 months. If you do not file and it is the right choice for you, your debts can continue to pile up beyond that 3-6 months, so filing as soon as possible can help protect you from future expenses.
- Con: The bankruptcy can appear on your credit report for up to 10 years. That can make it hard to get approvals for loans, among other things.
- Pro: Through state exemptions, you may be able to keep much of the things you need, including salary, wages and property obtained after filing.
- Con: You may lose some luxury possessions to pay off certain debts.
- Pro: You may be eligible for new lines of credit within one to three years.
- Con: You’ll lose your current credit lines.
- Pro: Bankruptcy can get those pesky debt collectors off your back.
- Con: The student loan vendors will not be deterred.
This is just a small list. We will continue next week with more of the pros and cons of Chapter 7.