When people think of being debt-free, they rarely associate anything about filing bankruptcy with it. The reason that most people file for bankruptcy is because they’re overwhelmed with unmanageable debt. Rarely do they consider that might be a byproduct. It’s usually after a couple meetings with a bankruptcy attorney that it sinks in and people realize that they might be able to do this. One of the most psychologically uplifting events for someone who has been buried under a mountain of debt for years is a bankruptcy discharge. That discharge lets the individual know that those debts are wiped as far as the east is from the west. No longer will they be responsible for that pile of bills and now it’s up to them to continue on with their fresh start.
If there is no way that you can pay your debts off in 5 to 7 years there is a good chance that filing bankruptcy might be in your future. Most individuals don’t want to spend their entire life paying interest only without ever putting a dent in the balance on a couple of credit cards that you can no longer use. The first step to becoming debt-free is being honest with yourself of how to eliminate your debt. If there is any way possible that you can just cut your expenses to the bare minimum, so that would allow you to pay off the credit cards then that would be the honorable thing to do. If there is no way that you make enough money to ever pay off these debts then you should speak to a bankruptcy attorney about filing Chapter 7 or Chapter 13 bankruptcy.
Which chapter you file depends heavily on your financial situation. That’s where a bankruptcy attorney would be a great help. The attorney would be able to evaluate your personal situation, including what property you own and want to keep. A Chapter 7 bankruptcy is best used for individuals that want to eliminate a large amount of unsecured debt like credit cards and personal loans. On the other hand, a Chapter 13 bankruptcy is one of the most powerful tools to use when it comes to protecting a piece of property, like the family home. After consulting a bankruptcy attorney you should have an idea of which chapter is best to file for your individual situation. The stress from overwhelming debt can cause physical illness and should be dealt with like a sickness. A debtor in trouble should face it head-on to try and cut off the damage. Being proactive will help the individual get on the road to becoming stress and debt-free.