Bankruptcy. The very word evokes strong feelings in most people. Though rarely anyone’s first choice when trying to cope with overwhelming debt, the decision to file should be made only when fully aware of all its consequences.

Here are some facts to consider about chapter 7 bankruptcy:

Filing bankruptcy can be expensive: Court costs and attorney’s fees add up, and are non-dischargeable. Depending on your situation, this is money that potentially could be spent bringing past-due accounts current, or making payment arrangements.

You may lose property: If your assets are worth more than state and federal exemption guidelines, they can be liquidated and the proceeds divided up among your creditors. This can include your home, car, heirlooms, and jewelry.

It doesn’t solve spending problems: Bankruptcy fixes the issue, not the cause.  It won’t be much use if you spend more than you make. Because credit is available even after discharge (usually with astronomical interest rates), many people quickly descend into debt again.

Not everything can be discharged: You can only walk away from such unsecured debts as credit cards and signature loans. So if a good portion of what you owe consists of student loans, tax debt, legal fees, or back child support, bankruptcy won’t help.

Bankruptcy will stay on your credit report for ten years: That’s a daunting time frame for most people. The damage to your credit report can possibly prevent you from renting an apartment, buying a home or car, or even acquiring life insurance. And many employers are now pulling credit reports to determine a candidate’s responsibility and stability, so even your future job may be at stake.