Credit card bankruptcy can occur as a result of not making your minimum repayments on any debts outstanding on your credit cards. Banks and lenders may consider legal action, such as bankruptcy, if you're unable to make satisfactory arrangements to repay your debts.
If you're drowning under huge amounts of credit card debt and falling behind in your payments or even struggling to keep up with minimum repayments each month, then it's tempting to simply declare bankruptcy.
The main catch-cry for any company advocating credit card bankruptcy is that all your debts are wiped clean and you can simply start again.
The reality is much harsher. Bankruptcy does more than just damage your credit score. It also affects how and what you spend during your bankruptcy period. Did you know that your bankruptcy attorney has the right to freeze your checking account so they can control which bills you pay during your bankruptcy?
There is also a risk that any asset you purchase during your bankruptcy may be repossessed by your bankruptcy attorney and sold to repay your old debts.
Where possible, avoid going bankrupt at all costs. There are alternatives to filing credit card bankruptcy that can be much better for your situation.
A good debt management company can help to negotiate your outstanding debts with your creditors and arrange easier repayment options designed to get you out of debt and out of financial trouble. Because they have many clients and work with credit companies every day, they have more negotiating power than you would as an individual.
Your debt management company could also help you to arrange negotiating lower interest rates or a debt consolidation option with a reduced repayment plan to combine your balances.
You could consider rolling your credit card balances into a debt consolidation loan or even a zero interest balance-transfer card. Your interest charges will be much lower than your credit card rates, so your repayment amounts should be lower and easier to keep up with. Just be sure to keep up with your new repayments or you risk getting into the same financial trouble again in the future.
Another option you have is to call the credit card company and ask for an interest rate reduction. They may be reluctant to reduce your rates if your payments are already behind, but explain to them that you're willing to make payment arrangements with them to catch up and a lower rate will make that quicker for you.
Rather than continue to sink under the burden of credit card debt, don't consider filing for credit card bankruptcy. Consider all your other options first and make sure they're all completely exhausted before you take the more damaging path to your credit.
Credit card bankruptcy should be your last resort wherever possible.

Author: Roger Vetruba

About the author:
Roger V runs http://DebtRESET.com/Free_Offer_Click.html Professional Debt Negotiation Services. For a Free 'Get Out of Debt' Comparison Calculator, Free e-books '13 Debt Reduction Mistakes', 'Debt Reduction Scams', and 'Drowning in Debt' & videos about financial strategies, click through to our site.

Article source: Free Bankruptcy Articles.