Debt consolidation is one possible alternative to filing bankruptcy. A debt consolidation loan allows you to combine all of your debts into a single loan repayment. This can dramatically ease your debt management; rather than worrying about several different repayments and their respective interest rates, your debts become consolidated into one loan with a single weekly or monthly repayment. Getting approval for a debt consolidation, however, may be difficult if your finances have become too unmanageable.
Debt settlement has become increasingly more popular as a bankruptcy alternative. An accepted debt settlement agreement is not to be taken lightly, as it is a formal agreement bound by law. If you have some income, or you have assets you’re willing to sell, you may be a lot better off negotiating with your creditors than filing for bankruptcy. Negotiation may buy you some time to get back on your feet, or your creditors may agree to settle your debts for less than you owe.
Design a Repayment Plan With Outside Help
Many people aren’t comfortable negotiating with their creditors or with collection agencies. Perhaps you aren’t confident with your negotiation skills, or the creditors and collectors are so hard-nosed that the process is too unpleasant to stomach. If you don’t want to negotiate on your own, you can seek help from a nonprofit credit or debt counseling agency. These agencies can work with you to help you repay your debts and improve your financial picture, however we have it on good authority and experience that most of these agencies are often connected with many of the credit card companies – so they may not have your best interests in mind. It is still a good idea to seek counsel of an experienced attorney.