Before filing bankruptcy it’s important that the would-be filer understands this should be the last resort. If there are other options they should be considered seriously before bankruptcy is pursued. The correct questions to be asked before filing bankruptcy are questions about what your situation truly is and about what you hope to accomplish after you file bankruptcy. There are many options that are temporarily closed to people who recently filed bankruptcy and it’s important to be aware of those limitations before filing.
There are things that become difficult if not impossible immediately after filing bankruptcy. Before filing bankruptcy you must ask yourself can I do without these choices or delay these choices for a few years.

1. The bankruptcy will appear on your credit report for up to 10 years, significantly lowering your credit score.

2. Obtaining large sums of credit after bankruptcy may be difficult to impossible. If you wanted to buy a new car or a home, both a car loan and a home mortgage may be impossible to obtain or very expensive because of the high interest rate for which you qualify.

3. Having a bankruptcy on your credit report may affect the possibility of qualifying for certain jobs. If your career is in financial services or security your may be labeled a security risk and not qualify for the position.

4. You must be prepared to use cash for most if not all financial transactions. Using credit may not be an option because you may not qualify for credit. You should also be prepared for mandatory deposits when opening new credit accounts, like utilities, credit cards, apartments/housing and loans.

If these are things you could tolerate and are prepared to endure, filing bankruptcy may improve your financial situation over time. Weigh the situation carefully balance what you get against what you lose. If you gain more than you lose, it may be time to file bankruptcy. Choosing which bankruptcy is the final step in making a decision to file.

Chapter 7 offers more immediate release, while Chapter 13 is necessary if you have possession that you want to keep such as a house and a car. Bankruptcy does not affect your retirement money, nor does it wipe out tax debt or student loan debt. Be prepared for bankruptcy to alter your life. The changes may seem quite negative initially but eventually you and your credit report you see improvement because of your choice to get out from under the crushing debt.