Why filing for bankruptcy is the best choice
If you are unable to choose between consolidating your loans and debt and declaring bankruptcy, it is essential to evaluate your entire financial situation. First, you should review your credit report. In addition to viewing your overall score, you should examine your negative items, such as late payments. This will enable you to fully comprehend the extent of your debt.
Once you have this data, you can calculate your total debt and compare it to your income. If your income is less than or equal to your fundamental living expenses, loan consolidation is not for you. Even if your income exceeds your basic financial requirements, you should not rule out bankruptcy before weighing the following advantages.
1.Consolidation. A Chapter 13 debt reorganization plan provides essentially the same advantages as debt consolidation. In addition to combining your obligations into a single monthly payment, bankruptcy offers you legal protections and benefits that a conventional consolidation cannot.
2.Intelligent Stay. If you have ever fallen behind on payments, you are aware of how ruthless and relentless debt collectors can be. They will continuously bombard your inbox, postbox, and phone throughout the day. Thankfully, filing for bankruptcy initiates what is known as a ""automatic stay,"" which promptly halts most collection efforts against you. Consolidating your loans and debts, however, does not stop any of these harassments.
Decreased Debt. Consolidating your loans and debt will make it easier to sustain financially, but bankruptcy allows you to discharge your debt. Even in a Chapter 13 bankruptcy where debts are reorganized, certain conditions permit you to pay as little as 10 percent of your unsecured debts.
4.Insolvency Attorney. Working with a bankruptcy attorney provides you with insight, legal direction, and professional guidance to help you obtain a new financial beginning. Compare this to the process of consolidating your loans and debts, where you labor primarily on your own and do not have an ally looking out for your best interests. Since a bankruptcy attorney is attempting to help you achieve the best possible outcome, you are aware that your actions will only improve your financial profile.""
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