| For some people, filing personal bankruptcy is the | | | | way to break free of your overwhelming debt, there |
| only way they can find their way out of | | | | are some types of debt that cannot be included |
| overwhelming debt. Whether your debt is the result | | | | when filing bankruptcy. Debt that occurs from |
| of not being able to pay your bills because you were | | | | student loans, taxes, child support, spousal support, |
| laid off work or the result of poor financial decisions, | | | | criminal fees and charges made on a credit card 40 |
| there are a variety of things to consider before | | | | days before filing bankruptcy cannot be included in |
| actually filing personal bankruptcy. When you first | | | | personal bankruptcy. |
| consider to file bankruptcy, you will need to decide if | | | | It is important that you realize filing personal |
| Chapter 7 or Chapter 13 bankruptcy will fit your | | | | bankruptcy will have a negative effect on your credit |
| needs better. As well, there are a variety of debts | | | | rating. This effect will last for approximately seven to |
| that cannot be included in your bankruptcy | | | | ten years, depending on what type of bankruptcy |
| settlement. | | | | you file. Although your credit score will be affected, |
| Chapter 7 bankruptcy requires that a bankruptcy | | | | you can still obtain credit after you have filed |
| trustee sell off your nonexempt assets so that your | | | | bankruptcy. However, the credit that you will be able |
| debt can then be repaid. With Chapter 7 bankruptcy, | | | | to obtain will carry a higher interest rate than it would |
| there is the risk of losing your home, along with a | | | | if you didn't have a bankruptcy on your credit. |
| majority of your other personal items. Therefore, | | | | Filing bankruptcy can also have other negative |
| before filing Chapter 7 bankruptcy, it is important you | | | | effects. For instance, if you would need to obtain life |
| have a full understanding how Chapter 7 works. | | | | insurance you may have a harder time obtaining a |
| When it is all said and done, if you file Chapter 7 | | | | policy. Many car insurance companies are now |
| bankruptcy, you will no longer have your | | | | charging a higher premium if you have a bad credit |
| overwhelming debt. | | | | score. Many employees are now running credit |
| Chapter 13 bankruptcy varies quite a bit from | | | | checks. Therefore, if you have a bankruptcy on your |
| Chapter 7 bankruptcy. Chapter 13 bankruptcy | | | | credit, it may be harder to obtain a job. You may |
| requires that a portion or all of your unsecured debt | | | | also experience psychological effects, such as |
| is repaid. A repayment plan is established through the | | | | depression. |
| bankruptcy court. Payments can be made over a | | | | For many, debt is a way of life. However, there are |
| period of 36 months to 60 months, depending on the | | | | instances when the debt becomes more than you |
| amount of the debt. The repayment amount is equal | | | | can handle. Personal bankruptcy is a way to help you |
| to or greater than the amount would be should you | | | | deal with debt that you can no longer pay. If you are |
| have chosen to go with Chapter 7 bankruptcy and | | | | looking to file bankruptcy, it is important that you |
| liquidated your assets. | | | | have a full understanding of the way it works, as well |
| Although personal bankruptcy may seem like a great | | | | as the lasting effects bankruptcy can have. |