Declaring bankruptcy can be a gut-wrenching decision. It carries such a negative connotation and it is often seen as the last resort. However, how much more damaging is it really than trying to hold on and catch up to pay off your current debt?
Credit problems can cause an excess of stress. When you have difficulties making your ends meet each and every month and the creditors are calling on the phone everyday your life can be miserable. So long as you have any delinquencies the stress stays, and these problems can stay on your credit report for 7 to 10 years.
A bankruptcy will also stay on your report for 7 to 10 years but the difference is that rather than fighting to repair bad credit you can start all over and begin to rebuild your credit. You can also relieve the undue pressure and that relief can help you to start living a life where you can prosper again. The longer it has been since you declared bankruptcy the easier it is to get credit.
So whether you decide to declare bankruptcy or you continue to try to play catch-up you will have credit issues that haunt you. The difference is that with a bankruptcy you can begin again with a clean record and otherwise you will have delinquency problems following you around for years. Some problems can’t really be repaired and it helps to just start over.
Immediately after a bankruptcy is discharged you can begin to repair your credit. Go to your local bank or credit union and get a small loan to pay off. They will likely charge you a higher interest rate but this should not be too much of an issue since you will only be borrowing a small amount and the plan is to pay it off as quickly as you can after you get a few on time payments recorded on your report.
You can also get a secured credit card. Many credit card companies offer credit cards based upon you making a deposit of cash into an account. Start with $500 to $1000, get your secured credit card and you have the process of rebuilding your credit started.
Your credit report will start showing improvement immediately as soon as you begin to do these things. Your report will still show the bankruptcy but you will be working towards better things. If you just try to struggle through your excessive credit problems it may be noble and you may believe that you are doing the right thing but in the long run you may be just prolonging the pain. You can rebuild after a bankruptcy but you can’t ever repair your credit if you are continually playing catch-up.
Bankruptcy is a serious consideration and it can be a very difficult decision to make. However, you will be able to start over and rebuild with a clean slate and sometimes that can be the best answer.
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