In part 3 of this series we discuss poor/excess use of credit which is the third most common reason for filing bankruptcy. Credit card bills, installment debt, car and other loan payments can eventually become unmanageable, until finally the borrower is unable to make even the minimum payment on each type of debt. If the borrower cannot access funds from other sources such as friends or family, then bankruptcy is usually the inevitable alternative.

Some may consider debt-consolidation plans but statistics indicate that most debt-consolidation plans fail for various reasons, and usually only delay filing for most participants. Although home-equity loans can be a good remedy for unsecured debt in some cases, once it is exhausted, irresponsible borrowers can face foreclosure on their homes if they are unable to make this payment as well.

Are you overwhelmed by the burden of excessive debt? If so, contact a Bankruptcy Attorney at 636-724-3355 or visit us at www.bankruptcysolo.com to schedule your no-cost consultation with an experienced bankruptcy attorney. 

Overwhelmed by the burden of debt? Bankruptcy allows you to become debt free faster and for less money than debt consolidation. You have nothing to lose by scheduling a free bankruptcy consultation. Join the long list of clients we have successfully helped to get out of debt.
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636-724-3355

Debt consolidation it not an option to take lightly. Most do not know that it could end up costing you money in hidden fees and tax liability. More importantly, it could cost you your home or other valuable property.

You could lose your property. If you use property such as your home or vehicle as collateral for the debt consolidation loan, you could lose that property if you default on the loan payments. 

Beware of hidden costs. Although lower interest rates and monthly payments are appealing, a debt consolidation loan could end up costing you more money. Often, debt consolidation loans help you achieve a lower monthly payment and interest rate in exchange for extending the repayment period. If you stay in debt longer, you may end up paying more over the long term.

​Negative tax consequences. Depending on your financial condition, any money you save from debt relief services such as debt consolidation may be considered income by the IRS, which means you pay taxes on it. Credit card companies and other creditors may report settled debt to the IRS, which the IRS considers income.

Bankruptcy is an alternative that eliminates your debt and gets you on the fast track to financial recovery. Call us at 636-724-3355 or visit at www.bankruptcysolo.com to take your first step to a fresh start.