Your boat is not sinking, but it is severely damaged by the financial storm. Two lifeboats come to rescue. The question is, which one to take? On the first one, hot tea and warm blankets are already waiting for you. This lifeboat can completely replace your own boat in a trouble. There is nothing much for you to do, you can sit and relax. The trouble is, you may not be able to return to your ship. What is even worse, you may not return to the ocean of finance, at least not on the boat of that size you owned before the rescue. On this lifeboat you will never be a captain, that is for sure.
Now, let us go to the second lifeboat. The first thing you are going to notice it is its size. No blankets and no tea, only hard work for you. On this boat you are not going to be a captain as well, but at least your words are going to be respected. You may be free to leave at any moment you want. What is even more important, this lifeboat is giving you more chance to return to your own boat, you had to leave in the hour of need. As you have already guessed your own boat is representing your home, assets and all other things related to your financial situation. Financial storm represents itself. First boat is referring to the bankruptcy, while the second includes debt management.
There Is (No) Hope
Although it may seem a little bit hard to comprehend, but the decision about which move to make is entirely up to you. There is no advisor in the whole world who knows better than yourself what is better as the solution for your financial troubles: bankruptcy or debt management. Your personal perception of the situation is all that actually matters. Do you think that your situation is desperate and helpless? Do you think you can manage the situation with only a minor adjustment of your financial obligations? Remember that you are to choose, but also to win or lose, your credit rating, maybe even your home.
Bankruptcy is a drastic measure. If you are already thinking about it, do not neglect the warning which comes with it: to be used only in the cases of extreme emergency. After bankruptcy nothing will be the same as it once was. On the other site, if you are considering debt management as an option for your situation, then you believe that you can still handle the debts. Nevertheless, in different circumstances and with lower but longer payment portions.
It is important to emphasize that the level of control may be crucial when you are making this kind of very important decision for your financial future. In debt management negotiations you are still in the position to negotiate with your lenders. There are no legal obligations from your agreement, but on the other hand you are completely influenced by the good will of your lenders who may choose to be more or less flexible when it comes to your financial situation. They also take care to protect their investment and not to push you over the financial cliff.
Desperate Times Call For Desperate Measures?
It is more than recommended to do some serious thinking before bankrupting. On the other side, you do not need debt management to buy additional time, but to pay your debts. Although dominant the opinion that bankruptcy includes your financial Armageddon is not entirely true. Perhaps what you need is to face your actual situation in its full content and with all of the consequences. If you have not judged your strengths appropriately, then debt management can give you the wrong picture about your odds which can easily turn out to have very negative consequences in future period. For these reasons bankruptcy may be better although drastic and sharp solution.
In some of the cases, people when faced with bankruptcy came up with new solutions and even new business ideas. The stigmatic effect could not be neglected. On the other side, after several years all of the bankruptcy records will be erased. Even after the bankruptcy discharge you will have to deal with the bankruptcy bad legacy. However, even that will have to become the thing of the past. One thing is more than obvious and important at the same time. The last thing you need in your desperate financial solution is unrealistic perception and false confidence. If you are not completely honest to your debt management plan, it can easily turn out to be your worst enemy instead of your best friend. On the other hand, do not eliminate the possibility to be saved by your worst enemy – bankruptcy.