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Bankruptcy - The Last Resort
By Lee Asher, Thu Dec 8th
Definition Bankruptcy is a legally declared inability or impairment ofability of an individual or organization to pay their creditors.A declared state of bankruptcy can be requested by creditors inan effort to recoup a portion of what they are owed; however, inthe overwhelming majority of cases, the bankruptcy is initiatedby the bankrupt individual or organization. Filing for bankruptcy is an extreme move, not a quick fix. It'sa long, painful process with a huge stigma, and you're unlikelyto be able to get any kind of credit for ten years afterwards.Yet bankruptcies are on the rise. Out of ignorance or stupidity,more and more people seem to be using bankruptcy as a firstoption, instead of a last resort. Before you do it, make sureyou've considered every alternative.
Have You Reorganised Your Debt? If you haven't tried debt consolidation or negotiation, youreally should. Yes, you'll have to pay back your debtseventually, but surely that's better than bankruptcy, isn't it?Debt consolidation loans enable you to combine all of yourmonthly debt repayments into once easy to afford repayment.Depending on the loan term that you choose, you can even reduceyour monthly
repayments to give yourself extra spending money. Sell Everything You Can It's better to sell everything you own than it is to go intobankruptcy. Move to a smaller house. Sell your cars and take thebus. Take a good, hard look at your life, and realise that thereare very few true 'basics': you can do without almosteverything. Your house is probably full of quite valuable thingsthat you never use, so bite the bullet and get rid of them. Inshort, subtract your debt payments from your income, and livelike someone who earns that much. You are going to lose almost everything you own if you declarebankruptcy, so you might as well try to sell it yourself at abetter price and avoid the bankruptcy issue altogether. Work More If you can get extra hours, do it. Being bankrupt is such anindignity that you should at least try going to your boss andasking for a pay rise or promotion. After all, the worst theycan do is say no. They're going to find out about it anyway ifyou declare bankruptcy, and they might wonder why you didn'tcome and ask for their help. Also, if you're married and onlyone of you works, try to get the other a job - you never know,it might even be fun! Use the Power of Threats One of the best things to do when you're considering bankruptcyis to write a letter to absolutely everyone you owe money to,letting them know. Make it a very clear threat: "if I cannotfind a way of paying my debts then I will be forced to file forbankruptcy". Most creditors would rather let you pay back a tinyfraction of what you owe than have to try to get money out of abankrupt. Know Your Local Laws Bankruptcy laws vary enormously depending on where you are.There are some places where you'll be forced to give upeverything you own to pay your creditors, some places where youat least get to keep your house, and some where you can declareyourself bankrupt and not even notice! Try to get a lawyer - youmight think that you can't afford one, but many will work 'probono' (for free) for people who really need a lawyer but can'tpay. About the author: Original Source: ArticlesGalore.com
Information supplied and written by Lee Asher of CyberTech SoftShop Suppliers of the DeadEasyEbook Maker and Publishing Wizard.
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