Financial Education

Think Carefully Before Filing

Potential changes in bankruptcy laws are getting a lot of media attention these days. Some consumers are hurrying to file bankruptcy before the laws change - thinking this may be their last chance. But before you jump on the bankruptcy bandwagon, think carefully about the downside to your decision.

Facts to consider about Chapter 7 bankruptcy:

Filing bankruptcy can be expensive: Court costs and attorney's fees add up - this is money that could be spent bringing past-due accounts current, or making payment arrangements.
You may lose property: Your assets, including your home, car, heirlooms, and jewelry, may be liquidated and the proceeds divided up among your creditors.
It doesn't solve spending problems: Bankruptcy won't be much use if you spend more than you make. Because high-cost credit is available even after discharge, many people quickly descend into debt again.
It may jeopardize your relationship with ElecTel Cooperative FCU: If ElecTel Cooperative FCU takes a loss on an account, we may not extend the benefits of membership to you in the future.
Not everything can be discharged: You can only walk away from such unsecured debts as credit cards and signature loans. So if a good portion of what you owe consists of student loans, tax debt, legal fees, or back child support, bankruptcy won't help.
Bankruptcy will stay on your credit report for ten years: The damage to your credit report can prevent you from renting an apartment, buying a home or car, or even getting insurance. And many employers are now pulling credit reports to determine a candidate's responsibility and stability, so even your future job may be at stake.

If you are experiencing financial problems, ElecTel Cooperative FCU wants to help. We have partnered with BALANCE, a financial education and counseling service that can help you get your finances in order, pay down your debt, and reach your goals - all at no charge to you. Call 1-888-456-2227 or click here for more information.