One of the first and most things I hear from people coming in to my office consulting about a potential bankruptcy is "I didn't want to have to file Bankruptcy." While that sentiment is commendable, the simple truth is that bankruptcy is often the right and sometimes only option available. Credit card companies' ridiculously high interest rates makes paying off large balances almost impossible for the average wage earner. The guilt about filing bankruptcy, in my opinion, stems from the many fallacies that the creditor PR arms have disseminated over the past decades. In reality, at least in Oklahoma, most of the myths like you will lose your home, automobiles, retirement, furniture, etc. is just that, myths. Also, bankruptcy can be the best thing that ever happened to your credit long term. And those of you who feel beaten and embarrassed by the thought of having to file bankruptcy remember this: Donald Trump has filed bankruptcy at least 3 times over the past 20 years.
In 1991 he negotiated with his creditors to give up the Trump Shuttle airline, a 49% stake in the Grand Hyatt Hotel, his 282 foot yacht, a 27% stake in the retail store Alexanders after falling behind on $4 billion in debt. He also had to relinquish large stakes in the Taj Mahal and other casinos in Atlantic City. By 1995 he had paid off creditors and trimmed his debt to $70 million and was even flying again in his own jet.
Trump defends bankruptcy as a smart business practice used by the likes of Carl Icahn and Henry Kravis. . ."We're using the laws to our advantage, That shouldn't be embarrassing, that should be smart."
So, when your considering your own bankruptcy remember that the laws are there for a purpose. You may just need to make the smart play and file bankruptcy and, who knows, you may just be flying private soon!
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