Historically bankruptcy has been seen as the last resort of Debt Management, with other debt management solutions such as debt management plans and IVAs been seen as preferable with many Debt Management Companies.

Though there are reasons not to choose with bankruptcy, there are also many reasons why bankruptcy may be the right choice for you;

It is by far the most effective of the debt management solutions as all your debts are wiped out, whatever the level of debt. Other solutions only remove part of your debt and some actually remove none of it.

Bankruptcy is the shortest time, usually taking year. An Individual Voluntary Arrangement usually has a 5 year term and Debt management plans increase the term of your debt.

The Costs of bankruptcy are also lower than other debt products . To go bankrupt you need to pay the court fees, and usually a one off charge to Company will assist you through the procedure. However both debt management plan and IVAs have ongoing monthly fees. On a positive note understand that even with the fees debt management solutions leave you with more money every month each week, and reduce you total payment made.

These three key benefits need to weighed against the downsides of bankruptcy which is that there is no protection for your house and assets and creditors will probably ask you to sell them, to pay back your debts.

Related Articles