Think Carefully Before Filing

Changes in bankruptcy laws are getting a lot of media attention these days. Some consumers are hurrying to file bankruptcy before the laws change – thinking this may be their last chance. But before you jump on the bankruptcy bandwagon, think carefully about the downside to your decision.

Facts to consider about chapter 7 bankruptcy:

• Filing bankruptcy can be expensive: Court costs and attorney's fees add up –  this is money that could be spent bringing past-due accounts current, or making payment arrangements.
• You may lose property: Your assets, including your home, car, heirlooms, and jewelry, may be liquidated and the proceeds divided up among your creditors.
• It doesn't solve spending problems: Bankruptcy won't be much use if you spend more than you make. Because high-cost credit is available even after discharge, many people quickly descend into debt again.
• It may jeopardize your relationship with your credit union: If the credit union takes a loss on an account, we may not extend the benefits of membership to you in the future.
• Not everything can be discharged: You can only walk away from such unsecured debts as credit cards and signature loans. So if a good portion of what you owe consists of student loans, tax debt, legal fees, or back child support, bankruptcy won't help.
• Bankruptcy will stay on your credit report for ten years: The damage to your credit report can prevent you from renting an apartment, buying a home or car, or even getting insurance. And many employers are now pulling credit reports to determine a candidate's responsibility and stability, so even your future job may be at stake.

If you’re experiencing financial problems, your credit union wants to help. We’ve partnered with BALANCE, a financial education and counseling service that can help you get your finances in order, pay down your debt, and reach your goals – all at no charge to you. Call 888-456-2227 or log on to www.balancepro.net for more information.