Individuals can find it hard to manage their financial conditions if they are greatly burdened by huge credit card debts.
Since the worsening economic conditions have led to an increase in the unemployment rates considerably, many people are finding it hard to meet their daily expenses and are unable to pay even the minimum monthly installments due on their credit card bills.
This situation can become worse when creditors start calling them and harassing constantly to make payments and clear their unpaid arrears.
The debtor finds themselves left with no other option than to declare bankruptcy as an emergency solution to deal with their financial problems.
Bankruptcy is one of the options usually taken in emergency to immediately give a relief to the consumers from their debt burden.
When an individual declares bankruptcy, the total amounts of his unpaid dues are eliminated at once.
Bankruptcy should be considered as the last debt relief option to get out of credit card debts burdens as it is disadvantageous for both the debtor and the creditor.
It creates a lot of troubles and hassles for consumers since it is a lengthy process involving credit counseling and also many visits to the court.
A consumer may also be required to pass certain tests to make them eligible for filing bankruptcy and if they fail short in any of the tests, they may not qualify for filing bankruptcy.
A consumer should only declare bankruptcy when he has no other relief alternative since it can really effect on the consumers future financial condition.
The credit report of a consumer is also greatly affected and the record of bankruptcy remains in his history for up to 7 to 10 years, making it difficult to apply for any new loans in the future, or to even reapply for bankruptcy for another 5 to 6 years.
The creditors also have to face huge losses since they don't just have to fore go the entire loan amount but also the interest that they would have earned on that outstanding amount.
Hence filing a bankruptcy has many negative consequences and if more and more consumers start declaring bankruptcy, eventually the financial lenders will have to close down their businesses leading to a negative impact on the economy.
Since the worsening economic conditions have led to an increase in the unemployment rates considerably, many people are finding it hard to meet their daily expenses and are unable to pay even the minimum monthly installments due on their credit card bills.
This situation can become worse when creditors start calling them and harassing constantly to make payments and clear their unpaid arrears.
The debtor finds themselves left with no other option than to declare bankruptcy as an emergency solution to deal with their financial problems.
Bankruptcy is one of the options usually taken in emergency to immediately give a relief to the consumers from their debt burden.
When an individual declares bankruptcy, the total amounts of his unpaid dues are eliminated at once.
Bankruptcy should be considered as the last debt relief option to get out of credit card debts burdens as it is disadvantageous for both the debtor and the creditor.
It creates a lot of troubles and hassles for consumers since it is a lengthy process involving credit counseling and also many visits to the court.
A consumer may also be required to pass certain tests to make them eligible for filing bankruptcy and if they fail short in any of the tests, they may not qualify for filing bankruptcy.
A consumer should only declare bankruptcy when he has no other relief alternative since it can really effect on the consumers future financial condition.
The credit report of a consumer is also greatly affected and the record of bankruptcy remains in his history for up to 7 to 10 years, making it difficult to apply for any new loans in the future, or to even reapply for bankruptcy for another 5 to 6 years.
The creditors also have to face huge losses since they don't just have to fore go the entire loan amount but also the interest that they would have earned on that outstanding amount.
Hence filing a bankruptcy has many negative consequences and if more and more consumers start declaring bankruptcy, eventually the financial lenders will have to close down their businesses leading to a negative impact on the economy.
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