If you’re considering bankruptcy, you’re probably at the end of your rope when it comes to your debt. No other solution seems to work for you and you’re wondering just how bad would things be if you decided to file bankruptcy.

Bankruptcy on Your Credit Report for 10 Years

Perhaps one of the worst things about bankruptcy is that you won’t be able hide from it for several years. While most negative information stays on your credit report for only seven years, bankruptcy will continue to be listed for an extra three years. Any business that checks your credit report for several years after you file bankruptcy will know that you’ve gone through a legal process to handle your debt.

Just because bankruptcy stays on your credit report doesn’t mean you won’t have access to credit. The older your bankruptcy gets, the less impact it will have on your credit score. There have been people who’ve started rebuilding their credit several months after filing bankruptcy.

Many Applications Ask About Bankruptcy

Though bankruptcy will fall off your credit report in as many as 10 years, you’ll continue to be asked whether you’ve ever filed bankruptcy. Many credit card, loan, and job applications ask if you have bankruptcy on your record and law requires you to tell the truth. If you lie on the application and you get found out, you’re guilty of committing fraud. Your employer may fire you or the lender may demand that you pay back the entire balance of the loan immediately.

Don’t assume no one will find out about your bankruptcy simply because it’s not on your credit report. Bankruptcy is a matter of public record and stays on file with the bankruptcy court forever.

How Will You Feel About Filing Bankruptcy?

You’ll experience some kind of emotional response to bankruptcy and no one can predict exactly how you’ll feel about filing bankruptcy. Some people are relieved that they don’t have to deal with their debt or their creditors anymore. They’re happy that they made the decision to get help through the bankruptcy court. Other people feel like it was a financial failure, that filing bankruptcy says something negative about their ability to manage money. There are all kinds of emotions in between those two extremes.

If you ultimately file bankruptcy, prepare yourself for an emotional side-effects that may come. Seek professional help through a counselor or psychologist if necessary. Telling someone how you feel about bankruptcy can help you work through any feelings of depression that may result. Realize that bankruptcy isn’t the end of the worlds and that you can bounce back from the negative side-effects.

Debt Settlement as a Bankruptcy Alternative

You may be able to avoid a bankruptcy filing by going through debt settlement. If you can get your debts discharged in a Chapter 7 bankruptcy, that may be a better option than debt settlement since Chapter 7 is often over in just a few months. Debt settlement, on the other hand, can take several years similar to what you’d spend under a Chapter 13 bankruptcy repayment plan.