3 years ago I was deep in debt and unable to see a way out. I was being called at home by debt collection agents – I dreaded the phone ringing. Every day I received threatening letters. Stress was making me ill and having to admit my situation to my wife was putting my marriage under a lot of strain (my wife was justifiably angry with me).
3 years on and I have resolved my debt crisis. I am looking forward to the future and am remarkably still married. The process of working through my debt crisis wasn’t easy, but the tough decisions I took then are starting to pay off now.
What is your debt story? Write a reply here, you might find that just writing it down helps you to come to terms with it/see what needs to be done to fix it.
Good luck!
Tags: credit counseling, Debt Advice, debt case studies, Debt Problems
The cost of bankruptcy will hit you in a number of different ways. There is the actual cost of filing for bankruptcy, the legal and counseling fees that you will probably have to pay and the increased cost of credit and insurance premiums over an extended period after your bankruptcy.
Cost of Bankruptcy - Filing Costs
The filing costs for bankruptcy are actually quite small and are as follows:
Chapter 7 – $299
Chapter 13 – $274
Cost of Bankruptcy – Legal and Counseling Costs
You will probably need to assistance of a attorney to file for bankruptcy. There are also new regulations that require you to attend credit counseling before declaring bankruptcy. Typical costs for these are going to be in the region of $700-$2000
Getting Credit and Insurance After Bankruptcy
Your bankruptcy will stay on your records for 10 years (or 7 years for chapter 13). During this period you will find it much more expensive to get credit, including mortgages (for chapter 7 bankruptcy you will probably be unable to get a mortgage at all for 2 years). In the current climate you might find it hard to get a mortgage at all. Insurance companies will use credit records, and consider people that have been bankrupt a higher risk. This will increase your premiums.
The Emotional Cost
There is much less stigma attached to bankruptcy than there used to be, but it’s still there. The effect on your family and relationships might be significant, you are certainly going to find out how strong your relationship is. If you have been hiding debts from your family then the double shock of also declaring bankruptcy will push a lot of marriages to breaking point.
Tags: cost of bankruptcy, Debt Advice
How to keep control of your debts, reduce them, or even avoid getting into debt in the first place might be one of the most important financial lessons you ever learn. Having excessive debt can damage your health and relationships and will keep you poor, so it is important to know how to keep it under control.
Debt Control – The Basics
You cannot control your debts if you don’t know what they are. Record all of your debts in one place with amount outstanding, repayment amount, interest rate, and time to repay. You can use this information to help you to decide which of your debts to pay off first.
You cannot plan to pay off your debt if you don’t understand how much you earn and how much you spend each month. Use your bank statement to write down a complete list of everything you earn and spend in a month. This will help you to see if you are able to pay off your debt on your current income.
If you feel that your debt situation is getting out of control then seek the advice of a reputable debt organization, preferably a charity or a company that gives initial consultations free. One thing that you must not do if you are in this situation is nothing (and another is taking on more debt). Delay can make things much worse and make the job of resolving your debt situation far worse when you eventually have to face it (which you inevitably will).
Tags: Debt Advice, debt control
