Bankruptcy Options Often Seem Too Few

Generally, the bankruptcy options for consumers involve two types of filing choices Chapter 7 and Chapter 13. Chapter 7 eliminates the mitigating debts that have piled up for both individual consumers and businesses. Chapter 13 restructures debts for individuals to put them into more manageable increments of payments. Normally, payments to creditors on a Chapter 13 filing are paid off over the course of 3 to 5 years. These chapters will effect assets such as homes, consumer debts, and credit. These choices will affect credit for as many as ten years. The chapters stay on credit reports for three years beyond when most debts fall off, which is typically seven years. The ability to obtain credit and loans for homes and autos can be affected for a few years beyond the process. Consumers should only go for these solutions as a last resort when every other possibility has been exhausted.

Statistics show that about one in every seventy people file on an annual basis. Bankruptcy options are of the utmost urgency to keep more consumers from filing. Some consumers really believe they are without any other choice. Many will file proceedings for amounts as minimal as $5,000. The burden of insurmountable debt and relentless creditors calling and sending venomous letters, causes consumers to succumb to this as their sole choice in the matter. Credit counselors may even advise a person that going for broke is the best way to go. This may or may not be true since the implications of filing can remain as public record with the courts up to twenty years. Employers can dig and sometimes find the information decades after items have been discharged from a person's credit.

We need more bankruptcy options for people. Lenders need to take some responsibility and have more programs in place to assist debtors that find themselves in trouble. Sometimes predatory lending practices can land a person into a situation where they seem to have no other choice. Also, credit should only be extended to people who truly are qualified. Stricter measures need to be put in place to help with the situation.