Will Bankruptcy Really Get Me Out Of Debt? (Blog)

Bankruptcy was all the rage and this year and it seemed to be one of the hottest trends even affecting some of the very rich and powerful. But, with the economic crisis and unemployment climbing to record highs, it’s no wonder that bankruptcies filed this year topped one billion. But, can bankruptcy really work for you?

Before Bush left his presidency, there was one little thing that he did. He signed into law a bill that would make filing for bankruptcy much harder that it had been in previous decades. The idea was that “bankruptcy should always be a last resort in our legal system,” the former president said. “If someone does not pay his or her debts the rest of society ends up paying for them.”

This bill met a ton of resistance from consumer advocate groups because, you see, this bill was backed by some of the most powerful banks, credit card companies and creditors. They had only their best interests in mind, not yours. It also meant that if bankruptcy was filed, it would be geared more toward Chapter 13 bankruptcy, which means your accounts would be froze and you’d have to pay some or all of you credit card charges. The Chapter 7 bankruptcy claim is the one that absolves you from all of you credit card debt. And, the one credit card companies wanted to avoid.

So four years ago, when the bill was passed, many fought it on the basis that those affected by this bill would be the middle to lower income working class, single mothers and minority. Well guess what? It is now those people that we see filing for bankruptcy.

The great thing is that there are other means to get out of debt, without the need to file bankruptcy. After all, you are going to have to pay back your loans. Debt consolidation and debt settlement programs may offer you a better choice to get out of debt and you won’t have the blemish of bankruptcy on your credit report. Programs like the ones offered here are a great place to start!

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