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What Personal Bankruptcy Means For You

March 20, 2012 | Comments: 0 | Views: 94

Does it hurt in your wallet already? Are you suffering from your personal financial problems? There is a solution for you! You may opt for debt consolidation services, or credit counseling, perhaps management of debts, or a consumer proposal from creditors, or you can file for personal bankruptcy. All of these options are open to you, but which one is best?

You may want to file for personal bankruptcy if you have a loss in your income, such as being laid off from your job or being unexpectedly unemployed without a source of income. Or perhaps you had t change jobs where your new job is paying much less than your previous job. Or maybe you have a major change in your personal life, where some expense is now going to be hitting your budget every month, blowing it out of the water.

With those types of negative financial impact on one's life, almost anyone can find reasons to consider personal bankruptcy as soon as these problems are realized.

If you file, you are protected from collection actions. You are also protected from legal action. With personal bankruptcy, you are also protected from wage garnishes. Your unsecured debts would also be eliminated, depending on what chapter of bankruptcy you are allowed to file.

Filing for personal bankruptcy is quick and is relatively inexpensive when compared to doing nothing about your debts and allowing your creditors to individually take you to court. The benefit of filing for personal bankruptcy would be felt just within six or twelve months. However this is depending on the situation that you are in.

However, this may mean that you will surrender some belongings to a trustee. You may keep low cost belongings, though. People usually believe that they will lose everything that own when they file for personal bankruptcy but this is not true. Sometimes, they will let you keep your low cost vehicle, your television set, and other things. According to the Insolvency Act, under Section 283, you are also permitted to keep your clothes, your beddings, and your furniture. So that you can keep your car, you must prove that you need it in your work. So, contrary to popular belief, many of your properties are actually safe when you file for personal bankruptcy.

While you are in personal bankruptcy, you will be required to keep a record of the income that you acquire. This record must be detailed. Also, the record must be done throughout the period when you are in personal bankruptcy. Sometimes, when you have an unforeseen expense to pay, say medical expenses or when you are filing for divorce, personal bankruptcy could be helpful.

But there are also many disadvantages to filing. This act will be a major red flag on your credit report for the next seven to ten years and will cause people to think twice about offering you any type of credit, or perhaps even a new job, since many companies are now looking at a candidate's credit report when considering them for a job opening. This is where things like debt consolidation services can be extremely helpful.

If you are not a financial genius, it is in your best interests to get a free bankruptcy evaluation from a financial expert, one who is much more familiar with what options are available to you in your particular situation than you are, and can tell you what your options are as well as the upside and downside of each one. Then you can make an intelligent and informed financial decision about the best way to move forward with the least amount of pain.

Should you file for personal bankruptcy? This is a question that most people answer too quickly and perform this act long before they should or even really need to because they do not know all the financial options that are available to them, even if they are in a bad financial situation. To get a free bankruptcy evaluation so you can know if you should file for Personal Bankruptcy please visit our web site at

Source: EzineArticles
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