No one wants to start a business venture that they think won’t succeed. A lot of people try their hardest to get their own business going from scratch, and through hard work and perseverance, some people are fortunate enough to get their business to take off. At the same time, hard work and perseverance are not always enough, and a lot of good people who put a lot of work into their businesses end up having to shut their doors too soon. Yes, there are success stories, but they are not a common occurrence. If your business has been struggling for a while and you can feel that you are falling further and further down a debt trap, it might be time to thrown in the towel. You can look into getting out of bankruptcy by consulting a proper bankruptcy lawyer, but there are a few implications that you should also consider.
- When you declare and file for bankruptcy, yes your debts are erased and you get a “fresh start,” but it goes on your permanent record.
- Once you have already filed for bankruptcy, it can be difficult to get bank loans, and you are likely to be rejected more often, and this only gets worse if you have filed for bankruptcy more than once.
- Your credit score is affected when you file for bankruptcy, and it will take a significant amount of time to get it back to normal.
- If you are struggling to get loans from banks, then you might end up having to rely on loan sharks which are risky compared to a bank loan.
- Your debts are not immediately forgotten, and you will have to declare your assets because the court will have to sell them to let the creditors get some compensation.