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how to approach filing for bankruptcy

By Lena / December 11, 2012

How To Approach Filing For Bankruptcy

If you are so overwhelmed with debt that there’s no chance of ever paying it back, bankruptcy might be your best option. Bankruptcy allows you to discharge your debts and start again. However, it also negatively affects your credit for the next seven to ten years, so you should only file as a last resort. If you decide it is in your best interest to file for bankruptcy, takes some steps to help protect your financial health–and your sanity–as much as possible.

Bankruptcy filers are required to attend a credit counseling session and a financial management course. These requirements are designed to help you to learn better financial habits so that you don’t face bankruptcy again at a later date.

It’s important that you take these requirements seriously. Pay close attention during the sessions and ask questions if you don’t understand anything. You should leave each session with a greater understanding of how you got into financial trouble and what you need to do to avoid future trouble than you had when you began. You may also want to do some thinking on your own or talk further to a credit counselor to figure out exactly what got you to this point.

You should approach bankruptcy as consciously as possible so that you can learn the financial habits you need for future success. This will allow bankruptcy to truly be a chance for you to start over.

It’s important that as you think about your situation, you don’t fall into depression. It’s easy to feel that you’ve failed or that bankruptcy is your “fault.” That’s not the point of introspecting about your finances; you want to learn better habits, not punish yourself for past mistakes.

Realize that bankruptcy is just a symptom of a problem that may not have fully been within your control. Many people end up having to file for bankruptcy because of the sudden need for expensive medical treatment that they can’t afford, which certainly is not your fault. Even if your bankruptcy occurred because of irresponsible credit use, you can still learn and grow, so it is nothing to feel ashamed of.

If you have given some thought to filing bankruptcy, you should know that this step is in your best interest. Try to think of it as a step towards taking care of yourself; although your situation may temporarily get worse, it will improve as a result of filing for bankruptcy, and you can rebuild a more secure financial future from your new foundation once the bankruptcy has gone through.

The best way to approach bankruptcy is to view it as your chance for financial rehabilitation. Whatever mistakes you’ve made in the past are going to be wiped out by the bankruptcy, and you’ll be able to learn better habits and start all over again. If you view bankruptcy in this manner, you shouldn’t be ashamed, embarrassed or impatient for your credit to improve. Instead, you can be proud of the fact that you took some steps to recover your financial health and trust that your finances will get better from now on.

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Lena

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