Question

todd and marys decision
todd and mary love the finer things in life. they both like to drive expensive cars and wear designer clothes and jewelry. the problem is that they cannot afford to live this lavish lifestyle. they have been living well beyond their means for many years. they have extremely high debt and have missed many of their payments over the last six months. they want to buy a home, but they have not been able to get a mortgage. both todd and mary are realizing that they have made poor financial decisions, and they are thinking of declaring bankruptcy.
what effects are mary and todd likely to face if they declare bankruptcy? check all that apply.
they will find it hard to get new loans.
they will find it easier to buy a home, since their debt will have been eliminated.
they will get to keep their cars, but they will not have to make payments.
they will have to pay higher interest rates on any new credit cards they obtain.
they will have poor credit reports.

Explanation:

Bankruptcy negatively impacts creditworthiness. Poor credit reports (from bankruptcy) make new loans harder to obtain and lead to higher interest rates on new credit. Buying a home becomes harder, not easier, due to bad credit. Assets like expensive cars may be seized to repay debts, so they won’t keep them without payments.

Answer:

They will find it hard to get new loans.
They will have to pay higher interest rates on any new credit cards they obtain.
They will have poor credit reports.