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Which Is Better: Paying Debt or Declaring Bankruptcy?

Posted By || 23-Oct-2012

When is it better to tackle your debts on your own, and when is it better to file for bankruptcy and get a fresh start? Unfortunately, there is no straight answer. The best choice for you depends on a number of factors, including how much you owe, what kind of debt you have, and what your future financial plans are.

You may want to consider paying off your debts if:

• You have a regular source of income.
• You could pay off your debts in less than 12 months.
• Your biggest debts aren’t affected by bankruptcy (such as student loans).
• You have assets that would not be exempt from liquidation that you would like to keep.

You may wish to consider bankruptcy if:

• You do not have significant assets or regular income.
• You could not pay off your debts even over an extended period of time.
• Your debts would be erased or redistributed with bankruptcy (such as credit card debts).
• You are eligible for either Chapter 7 or Chapter 13 bankruptcy.
• You understand the effects of bankruptcy on your credit report and are willing to rebuild your credit after bankruptcy.

No one wants to file for bankruptcy, but for some, it is the best and only choice when it comes to escaping debt and returning to a normal life. To learn more about your options, speak with a Chula Vista bankruptcy attorney about your financial situation today. Call 619-458-3739 to schedule a free evaluation from an experienced lawyer.

Categories: General