Bankruptcy may be the answer for some people having financial difficulties because it essentially erases all past debts and allows you to start over. Although bankruptcy may give you a second chance to learn to manage your money better, your credit history will be tarnished. It should be avoided if at all possible, and considered only when there is no other choice.

There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Here's a brief description of each (for more information see the Life Advice® article Bankruptcy and consult your attorney): 

• Chapter 7 bankruptcy erases most of your past debts. You are not required to pay the erased debts, but you're also not allowed to keep many of your assets. State laws determine what you can keep. You can file Chapter 7 if you owe any indebtedness, provided that the purpose of the filing is not to perpetuate a fraud. You still are responsible for child support, alimony and past and present taxes. This type of bankruptcy generally stays on your credit record for 10 years and limits future lines of credit.
• Chapter 13 bankruptcy allows you to hold onto most of your assets and belongings. If you have a job and can make some payments every month toward your debts, this type of bankruptcy is generally the better option. The court will approve a payment schedule, which you must adhere to, and you must be able to pay off all debts in five years. Your credit record will carry notice of this bankruptcy for seven years, but it still may be possible to borrow money if you show that you are committed to paying your debts.

MetLife, its agents and representatives may not give legal or tax advice.  You should consult with and rely on your own independent legal and tax advisers regarding your particular set of facts and circumstances.

Your Financial Future
Addressing credit problems as early as possible is the key to a sound financial future. Build a good credit history by sticking to your budget and paying bills on time. Then when you are ready to buy a home or are faced with a financial emergency, banks and creditors  should be happy to help you realize your dreams or help you get over a hump. By managing your money responsibly now, you'll be better able to reach your financial goals.