When getting swarmed from defaults, bankruptcy seems like one of the only ways out. All it takes is a little push when a person is already near breaking point for bankruptcy to kick in. Reasons could be unexpected medical costs, loss of income, divorce, and other unforeseeable circumstances. When loans and debt consolidation can't handle it, bankruptcy will be a way of relief, and one of the only options left. Even so, you need to struggle to avoid bankruptcy until the last second, for it comes with many consequences.
Bankruptcy Completely Destroys Your Credit
While its purpose is to give you relief from your financial troubles, it does leave its mark on your credit record. This entry could prevent you from obtaining most forms of credit for up to 10 years. The reason for this is simple; lenders think people who file for bankruptcy is only using it to escape from debt commitments. This is to say, most lenders will decline your lending applications once they see bankruptcy on your credit record. Furthermore, since they have checked your credit record before declining your application, the failure to obtain credit is also recorded.
Erasing Bad Credit
If you have filed for bankruptcy and have tried to obtain credit afterwards, you would have probably given up (unless you are seeking secured loans in Australia; those are easier with a strong asset). The thing is, obtaining credit is very possible, if you know what to look for and are ready to face the consequences. Basically you need to be prepared to pay a little extra, and settle for bad credit loans. It is also a good idea to seek out credit record repair services. It may take a little time and it won't erase your bad credit, but it will minimize it and that is the best thing you could hope for while staying in the legal boundaries.
Making Use of Business Loans in Australia
Rather than trying to reduce the impact of the bad credit, some people choose to run with it and make the best of it. Business loans in Australia are an interesting alternative to credit record repairs. You are able to borrow a large sum of money, and have the chance to make a profit out of the loan, making repayments easy. Your lender will need to verify your goals and will stay in touch with you every step of the way. Should they foresee trouble, they will contact you and give you recommendations and/or options on what you need to do. However, all of this requires a strong asset to overshadow your credit history, and this is the main weakness in using this method.
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Bad credit loans can be found at http://www.badcredit-loans.com.au/
And business loans can be obtained at http://www.smallbusinessangels.com.au/