Although we are only a few weeks into the new year, you may already be seeing the futility in keeping your resolution to get out of debt. Like many in Illinois and across the country, the pressure of overwhelming debt may be too much to bear. You may be experiencing many sleepless nights, and even your physical health may be suffering.

Filing for debt relief through bankruptcy is an option you may be considering. Chapter 7 bankruptcy is one way to wipe out much of your debt and start over with a clean slate. For many, taking this step allows them to begin immediately to rebuild their credit while learning important skills to manage their money. However, Chapter 7 bankruptcy also has its disadvantages, and it is important to have a complete understanding of the process before deciding to take this step.

Your credit rating

It is difficult to overlook some of the negative aspects of a bankruptcy. You will hear from friends and family that a bankruptcy will ruin your credit and that you will lose everything you own. While it is true that having a Chapter 7 on your record will damage your credit rating, your credit may already be suffering because of your delinquent payments and collection efforts. You can continue to struggle, or you can take the hit with a bankruptcy and begin to rebuild your credit as soon as possible.

Within six months of filing, you may be free of most of your debt. Those debts that remain, such as your mortgage or student loans, may be much easier for you to manage when you are rid of the other debts. This means the end of creditor harassment, wage garnishment and foreclosure proceedings. After about a year, you may be able to open new lines of credit. You may pay higher interest, but as time passes and you demonstrate your good efforts, your rating will improve.

Your belongings

Chapter 7 bankruptcy is sometimes called liquidation bankruptcy because you may have to relinquish some your luxury possessions to auction to repay your creditors. However, the law also protects many of your belongings, such as your home, income and some personal items. Each case is unique, and you may wish to obtain the assistance of an attorney if there are items you wish to protect from liquidation.

In fact, having legal assistance by your side through every phase of a Chapter 7 bankruptcy, including determining if it is the best option for you, can improve your chances of success throughout the process and the opportunity of reaching a bright future free from debt.