We were forced to close our business when we were unable to collect a significant amount of money from a vendor. We used all our available credit and our savings to try and stay current with our bills, etc. We had outstanding credit prior to this devastating experience. Between the downturn in the economy and real estate market we are left with essentially no assets and a tremendous amount of debt. Our home is worth app. 75% of what we owe on it. We have always been self employed and have started a new business - home based - no employees - no assets, but growing a business with no marketing dollars is slow going. We have consulted a bankruptcy attorney and qualify for Chapter 7. We planned to file, but a business associate told us to avoid bankruptcy at all costs. Several judgments have already been filed, but with no assets, nor salary to garnish, there is not much the creditors can do. We are in our mid 50's - no children. Obviously our credit is shot. Is it better to just declare Chapter 7 and start new,
Response 1: Yes, it is. Yes, you would get a freshstart if your bankruptcy case is successful eventhough that the fact you filed for bankruptcy protection would stay on your credit report for 10 years starting on the day of the filing of the bankruptcy petition. On the other hand, filing for bankruptcy protection would stop all the collection calls.
or try and ride out the statute of limitations on the judgments - hoping the creditors are not vigilant enough to renew?
Response 2: This may not be a good option as you may have other lawsuits coming your way. You do not want to spend your time going to Court to defend one lawsuit after another. This would be very time consuming and mentally tasking. You need to concentrate on your new business and not spend the time fending off lawsuits or worrying about whether your judgment creditors would or would not renew their judgments against you..
Is there any other option?
Response 3: Unfortunately not. If you do not have any money and are barely making ends meet, it is difficult to try to settle a debt when you do not have money to settle the debt. Yes, bankruptcy would be on your credit record for 10 years. However, your credit is already ruined if you are considering bankruptcy option to get rid of your bills. The fact that you have these debts are already devastating your credit profile.