Bankruptcy is an issue with a lot of negative consequences. It is something all the companies should duly avoid. Anyone who files for bankruptcy should be aware of all the issues before taking such a heavy step. Before taking such a decision, you should consult a qualified consumer bankruptcy attorney so that you can understand the process better. However, before you schedule an appointment with your attorney, here are some consequences of bankruptcy that you ought to be aware of: 

1. A declining credit score - If you file for bankruptcy, your credit score is bound to decline. Also, you should know that bankruptcy doesn’t erase your past debts, even if the debts are discharged. Lenders will often believe that you are a very risky borrower and hesitate in lending you financing alternatives. You can also end up with high-interest rates when you borrow a loan, even if you qualify for all of them. Bankruptcy remains on your credit report for a very long time. It takes a huge bite of your credit score and lowers your repute as a businessman.

2. Privacy - There is a complete violation of privacy during the process of bankruptcy. A negative consequence of bankruptcy is that everything you file with the court, including all of your bankruptcy schedules, which contain personal information, can be accessed by the public. Hence, your friends, family, neighbors, etc can know how much money was owed to who. This is a deal-breaker, as it completely exposes your records.

3. Possible loss of property - Those who declare bankruptcy may lose property to the bankruptcy trustee. The main motive of filing for bankruptcy is to have the court step in and decide how much can you possibly afford to pay off and how much can possibly be forgiven. If you own property with a significant value, it is at sheer risk. If you own luxury cars, you may be forced to sell them off to pay your debt too. However, if you can successfully exempt your property, the trustee will not be able to sell it.

4. Loss of credit cards - Many credit card companies will automatically cancel your credit card if you file for bankruptcy. 

5. Difficulty in obtaining a mortgage or a loan - Filing for bankruptcy can make it extremely difficult to apply for a mortgage or a loan.

6. Denial of tax refunds - State, local, and federal tax refunds can be denied because of bankruptcy. This will result in a further loss.

7. Job and housing stigma - Filing for bankruptcy can negatively affect your prospects in buying a new house or applying for a new job. It basically makes you look like an incapacitated individual.

Kenneth Halpern has been a lawyer with a great practice in Long Island for 35 years now. Whether you need legal counsel for bankruptcy, representation to save your home, or information on a loan modification, he can provide you great information on these issues. He is the most learned foreclosure attorney in Long Island and helps people when they confront a legal crisis.