Should you file for bankruptcy?
If you’ve got a mountain of debt, it may seem like the only thing to do.
Still, this is a decision you can’t take lightly.
While it may be the right decision for one person, bankruptcy could be a bad move for you.
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To figure out if it’s right for you, there are two key things to think about:
- Bankruptcy alternatives.
- The pros and cons of bankruptcy.
What alternatives are available?
In general, you can see the following alternatives to bankruptcy:
- Debt consolidation loans.
- Debt settlements.
- Debt restructuring/a debt management plan.
- Consumer proposals.
Now, the availability of these alternatives depends on your financial situation.
This is why it makes sense to book yourself in for a debt assessment as soon as possible.
You can actually book one with us, and we can go over your current situation.
We will look at how much you owe, how much you own, and how much you earn.
This lets us get a grasp of what your budget currently looks like.
We see how much money is leaving your accounts every month, and how much you have coming in from here, we can formulate a plan to tackle your debts.
If your situation isn’t too severe, you may find that a simple restructuring of your budget will pay your debts.
Or, a small debt consolidation loan gets creditors off your back and lets you pay off your debts in a few months.
However, for severe cases where you’re falling deeper into debt and creditors are threatening legal action against you, it might be time to consider either a consumer proposal or bankruptcy.
What are the pros and cons of bankruptcy?
Bankruptcy is one of only two insolvency options available to Canadians.
It is a legally binding process, which is beneficial to you.
It means that your creditors have to abide by the rules set out in your bankruptcy.
This includes not collecting any money from you apart from what’s set out in the terms.
In essence, it gets creditors off your back once and for all.
The key advantage is that it offers a fresh financial start for someone in debt.
You clear most of your unsecured debts, and can finally have peace.
The downside is that you may have to sell a lot of your assets when going bankrupt.
Also, you get the lowest possible credit rating, and it stays with you for at least 6 years after the bankruptcy is over.
You may have to completely restructure your life and downsize, which can mean dramatic changes for you and your family.
In short, bankruptcy can be the right option if it is your only option.
Still, be sure you take all the alternatives into account before pursuing this path.
Call us now for debt advice
We are more than happy to help with any debt issues you may have.
Book your debt assessment today, and we’ll figure out if bankruptcy is right for you.
Fill in our online evaluation form or give us a call to schedule your assessment.