Living Life As a Credit Risk After Bankruptcy

People filing Bankruptcy are finding it easier to pay their bills, but harder to live a better life.

Once someone files Bankruptcy, they become a bigger Credit Risk.  So if you know anyone hopelessly considering Bankruptcy, they should consider the years of negative credit consequences.

Today, I was reading a story about Danielle Lancaster.  You may not know her and in fact, I just read about  her heart-breaking story in the Washington Post.   Danielle, filed Bankruptcy when her debt became twice that of  her monthly income.

Although Danielle was able to Bankruptcy,  she still owes money to her Creditors.

Danielle was not granted a ‘Clean Sweep’ of her debts.   She is on a repayment plan.

After the Bankruptcy, Danielle is also finding it hard to get a better paying job.  Not because of the Bankruptcy, but because she can’t move her family to where the better jobs are.  Danielle can’t get a Landlord to rent to her without a lot of money upfront.

In theory, Danielle would be able to rent an apartment for her family after Bankruptcy. But in real-life, Bankruptcy makes her a Credit Risk.

Fantasy Land of Bankruptcy

People talk themselves into Bankruptcy out of fear.  Bankruptcy does make the Creditors back off.  And Creditors backing off eases some of the tension bad Credit and Debt cause.  But what do people learn after they file Bankruptcy?

• They are trapped in Debt for up to 20 years (just less of it).
• Their Credit-Worthiness is worthless (people are scared to do business with them).
• They find it harder to get life back on track financially.

Why not consider the alternative to Bankruptcy?

I’ve asked this before.  Why don’t people consider their other options to filing Bankruptcy?  I think the answer is because they do the math.  They figure they can pay about $2,500, file Bankruptcy and be done with it.  I have to face the facts, Bankruptcy is a quick-fix.  Bankruptcy works when filed properly.

So, if you know someone who really has their heart on filing Bankruptcy, ask them if they’ve researched the negative consequences of filing.  Ask them are they ever going to want Credit again (maybe to start a Business)? Ask them if they are prepared to live on the wrong side of the tracks for about 10 years?  Ask them if they are prepared to live life as a Credit Risk?