If you are drowning in debt and your income is nowhere close to covering them then bankruptcy might the only way out for you. A bankruptcy is hazardous for the credit rating. The Credit score comes down remarkably and the record shows it for at least 7 to 10 years. Before you take this step ensure t at all other option is closed for you. These steps will help you ensure if bankruptcy is your only way out.
You can learn more at financial relief options available.
Analyse your finances thoroughly. Collect all your financial records and enlist all your income, expenditure and debt related information. This will give you an idea about how much you owe to your creditors. If the amount that you owe is in excess of the amount that you earn by thousands of dollars then opting for bankruptcy might be your only chance.
See if consolidating debt can ease the pressure and make life more manageable for you. Through this method you can get a new loan at a much lower rate of interest to pay off your previous loans. It not only eases the monetary pressure but also gives you the convenience of serving only one loan. A lower interest rate can save you a lot of money which can go into paying off the debts. The only drawback is that the loan will go on for a longer period of time. However, it will be a more reasonable solution for getting out of debt.
Credit counselling is another useful debt relief method. It helps you get rid of your debts by negotiating reasonable payment plans to with the creditors. Even if you apply for bankruptcy, you will have to undergo a mandatory credit counselling. Hence it is better to check with them directly.
Debt settlement is a legitimate alternative to filing bankruptcy. If consumers are experiencing a financial hardship and have at least $10k in unsecured debt then debt settlement can be a legitimate way to eliminate up to 70% of that balance.