/biz/ - Business & Finance

>>55772188
Bankruptcy is only a tolerable option if you,
>Don't anticipate borrowing money again (i.e., expect to rent, mooch, or ride a bike forever)
>Are so wealthy that your lawyers and accountants will be able to broker a deal, keep some of your assets, and - ultimately - be someone banks would loan to again
In other words, if you aren't dirt poor or filthy rich, it's a bad outcome.

>>55772218
>(i.e., expect to rent, mooch, or ride a bike forever)
I can't see myself ever being able to afford to own a home, maybe if my father leaves me an inheritance, so don't see that really impacting me. Also the bankruptcy period only lasts for three years in my country so don't really see that being all that detrimental to being able to borrow long term. It would take me at least 3-5 years to clear the debts I have now even if all the interest was frozen. What's the difference?

>>55772281
The difference is bankruptcy is terrible for your credit rating, which is the means by which the lender determines the terms they'll offer you, in order to protect their investment. It's risk and reward. The riskier you are, the bigger the reward they'll need to justify it which they'll achieve by offering you unfavourable APRs (if they don't reject you outright). Access to cheap money is very valuable as you get older. Bankruptcy makes it hard to get.

>>55772401
I have an excellent credit rating now and there's absolutely nothing I see that I can use it for. As I said I'll never be purchasing a house, so what's the big deal of a bad credit rating? Couldn't I simply wait out the three years free from debt then get a credit-builder loan until my credit rating is high enough to be approved for something else?

>>55772483
If you don't intend to take out (m)any loans, it won't have a large impact on your life. It isn't as simple as rebuilding your credit, though, because a bankruptcy is a permanent black-mark on your record. It would always impact your ability to take out a significant loan at a competitive rate. There are some other implications to (e.g., might be a problem working in certain jobs, industries, holding office) but those will depend on your circumstances, location, etc.

>>55772632
None of that really seems like it will impact me but what's the alternative? I'm not gonna be able to repay this debt. Even if I wanted to. What's worse long term? Defaulting on a bunch of loans for not paying or bankruptcy? Because one of those is gonna happen.

>>55772658
>What's worse long term? Defaulting on a bunch of loans for not paying or bankruptcy?
Bankruptcy is worse. Typically, you would default on a loan before declaring bankruptcy, as it buys you more time to try and improve your financial situation. An individual default on unsecured loans, even several, will hit your credit rating but shouldn't be insurmountable. You can still (eventually) rebuild your standing in the eyes of lenders over time. A bankruptcy is like a big "don't loan to me" sign that sits around your neck for the rest of your life. Also, some companies won't hire or promote you if you've declared bankruptcy, so there are impacts beyond getting loans. You don't know how your life might change either. Maybe you'll suddenly get a great idea to start a company in 15 years but the bankruptcy could stop you getting the funding you need. It's not a good outcome.

>>55772720
Sounds like the best course of action is to just not pay the bills then.