Considering filing bankruptcy? If your finances are in ruins and you're considering filing bankruptcy, there's a few things you should know.

Bankruptcy is not your only option. Millions of people credit is devastated by bankruptcy every year. Though filing a Chapter 7 Bankruptcy will clear you of any obligation to creditors, it is devastating to your credit and will ride your credit report for ten years.

There are several alternatives to bankruptcy depending on your current situation. You may consider:

Debt Consolidation- Debt Consolidation is an easy and timely alternative. A Debt Consolidation Counselor will evaluate your current situation and past debt and develop a budget for you.

They will negotiate payment options with your creditors and simply provide you with the alternative to make one easy monthly payment to them and they will disburse the payment among your creditors. The benefits include:

* Usually, a lower monthly payment
* Lower percentage rates
* Debt payoff in a timelier manner
* Less contact from creditors or no contact from creditors
* You will be able to keep your credit at satisfactory standards versus the harsh impact a bankruptcy would have on it
* You're able to obtain new credit
* And with the money you save with the advantage of a lower monthly payment plan you can contribute to a Savings Account or Retirement Account

The above benefits are just a few of the benefits of Debt Consolidation versus Bankruptcy.

Another alternative is a Personal Loan or Debt
Consolidation Loan. This is one large loan to pay off smaller loans or debts. With one large loan, you will normally have a lower percentage rate and a longer pay off period. The benefits include:

* The ability to pay off debts in full
* No more harassing phone calls from creditors
* Your credit will be saved from derogatory accounts andcollections * Low percentage rate

However, in order to obtain a Personal Loan or Debt Consolidation Loan you will need satisfactory credit. Though there are alternative to filing bankruptcy; in some cases, bankruptcy is the only option.

Before deciding whether to file bankruptcy or consolidate, consult a financial advisor. He or she should be able to give you advice after evaluating your situation and current credit standings.

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Written by: John Williams