Bankruptcy - A good choice for you?

Very little has been written about whether or not debt relief filing is a wise way to go and what standards might help someone make a decision regarding whether or not to file. Court-mandated debt relief is not something you ought to leap into, but with the changes in the bankruptcy law coming about recently, now would be a good time to examine your situation. Everyone has cash troubles to a certain extent, and applying for personal bankruptcy is clearly a solution that is best utilized as a last resort. A bankruptcy filing stays on your credit report for ten years, hurts your FICO score and can make it hard to find a job, a house or a favorable loan. A lot has been written about the new bankruptcy law and how it might affect individuals with money struggles.

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Listed below are a few tips that might help you decide if bankruptcy is a good move for you.

• You are paying the the very least payments only on your charge cards - If you are merely paying the minimum on a big balance you're in a lot of trouble. If you have a $10,000 outstanding balance and you've been paying two hundred dollars per month, it's going to double to $400. Current laws urge the bank card companies to have you repay your debt in a "realistic" amount of time which has resulted in a huge increase in required payments.

• You are making payments on one credit card by taking an advance from another - Taking a cash advance from Discover Card to pay your Mastercard bill isn't an indicator of wise money management. If you are borrowing money from one source at 20% to pay another at 20% and you're paying a cash advance fee too, you are more than likely in a lot of trouble.
• You have more than two major bank cards with outstanding balances - Bank cards work well as a short-term loan. Credit cards shouldn't be a funding source, as they represent a relatively steep way to borrow money. Credit cards are a convenience and a way to spend money when you don't have the money at hand. If you have outstanding balances on more than two major credit cards, you are possibly borrowing more than you can afford to repay. Bank card loans are a more affordable choice than cash advance loans, but are still a poor way to borrow money.

These are a few of the indicators that you might be in sufficient financial trouble to justify filing for debt relief; do you qualify?