Bankruptcy is an absolute last resort and should never be considered unless you are on the verge of losing some of the most basic requirements of life like you home or you have absolutely no options other than to not eat (meaning you’ve sold off everything you own and still can’t keep up). After 7 years the bankruptcy will be off your record, but then you need to start over again at that time. It’s not as simple as it disappearing completely.

If you can’t get a consolidation loan, you need to create a strategy to pay down your debts. Google search “DEBT SNOWBALL”. This is the best and most widely used debt management/reduction strategy on the planet. It’s promoted by almost any reputable debt company and by “guru’s” like Dave Ramsey, Richard Kiyosaki and more.

Here’s basically how it works:

Do a budget to free up cashflow. Cut out ALL unnessessary expenses. Find second jobs, whatever you can to free up cashflow and give you extra money to put towards the debt.

Take that extra money and apply it to the smallest debt (which is ussually the highest interest rate…if there are 2 debts close to the same, take the highest rate first).

When the first debt is paid off take the entire amount (extra money, plus whatever the monthly payment was) and add it to the next smallest debts payments.

Continue carrying the monthly payments from the paid off debts to the next debt until all the debts are gone. As each debt gets paid off, you will be accellerating the payments on the next debt becuase the additional payments will get bigger and bigger…like a snowball rolling down a hill (hence the name).

I’ve seen people who claimed bankruptcy over student loans (when that was still an option). Tell you what. Most of those people say they regret it.

Bankruptcy will affect your life for the worse for a long time.