2007-03-21 17:24:12 · 5 answers · asked by Kristine 2 in Business & Finance ➔ Personal Finance
This really depends on your state of despair. Ask yourself a couple of questions: Is consolidating my debt only delaying the inevitable (bankruptcy)? or Would consolidating my debt free up enough monthly operating cash to begin the recovery process?
From these answers you should be able to provide your own guidance. But since you asked, here's mine:
If you are in delay/denial mode, consider yourself nudged into action. You must begin taking action immediately. Just remember that federal and most state bankruptcy laws were drastically modified in October of 2005, so consult a personal bankruptcy attorney to ensure that you actually qualify for BK before you simply stop paying your debtors. Because if you stop paying your debtors and you don't qualify for BK then you will ruin your chances of a debt consolidation strategy.
I am quite well versed in these situations and wish that I had a bit more information concerning your dilemma. What caused the cash crunch? How much equity do you have in your home? What are your credit card balances? Do you work full-time? What is your current credit score?
Maybe re-post your question with a little more info? Good luck...
2007-03-21 17:43:19 · answer #1 · answered by StrategicPlanner 1 · 0⤊ 0⤋
Unless you have a unique situation, debt consolidation is better. Get all your "overwhelming" bills into one managable monthly payment. And debt consolidation doesn't affect your credit score like a bankruptcy. A bankruptcy will haunt your credit (and score) for a loooong time. In CA, personal bankruptcy isn't an option anymore anyway.
2007-03-21 17:31:43 · answer #2 · answered by Darcy 2 · 0⤊ 0⤋
Bankruptcy.
2007-03-21 17:48:07 · answer #3 · answered by Anonymous · 0⤊ 0⤋
The correct answer could be neither of your alternatives. Evaluate the reasons why you have the debt situation. Is it just selfish spending, lack of income, or what??
I'm no genius, but I have read and recommend Dave Ramsey's book The Total Money Makeover, which was written with focus on the family with debt, and leading the family out of debt into prosperity. Also, I listen to his radio program on AM.
Good Luck
2007-03-21 17:34:03 · answer #4 · answered by snvffy 7 · 0⤊ 0⤋
debt consolidation......do go for bankruptcy . ppl who have gone for bankruptcy have ruined their lives
2007-03-22 00:39:09 · answer #5 · answered by queen i 1 · 0⤊ 0⤋