Posts Tagged ‘bankruptcy alternative options’

Bankruptcy Alternative Options That Are Not Likely To Fail

If you spend some time and ponder over it, you will surprise yourself by finding out an array of bankruptcy alternative options that can help you regain control of your debt and financial situation without requiring you to become bankrupt. What usually happens is that people become too frustrated with their mounting debt problems to think of any better solution. They lose all their hopes and start looking out for an easy solution because they think they are no more able to handle the stress. This is how people often end up filing for bankruptcy protection even in cases where they could have saved their financial life by using better alternatives. Following are some of the options that you are strongly recommended to work on before you file your petition.

Settling Debts Through Negotiations

When it comes to working on bankruptcy alternative options, the first thing you have to do is to make a list of all those debt accounts where you have not made any payment over the last twelve months. The chances are that the statute of limitations applicable to those debts is going to expire soon. When the statute of limitations expires, you can no more be held liable to make the repayment on those debts. But, even your creditors are aware of the same. They will keep on taking an array of actions to collect their debts before the statute of limitations expires. They may even file a lawsuit against you and request for wage garnishment, liquidation of some of your assets, or even a forced bankruptcy. The thing that is very important to note here is that in reality, no creditors want to go for the legal way to collect their debts because it is expensive and there are also big chances of loss. Therefore, if you use this opportunity to negotiate an affordable repayment plan with your creditors, the chances are that the negotiations will in your favor. Always remember, no creditors want their debtors to use bankruptcy protection because it results in big loss for them.

Get Help From A Debt Consolidation Or Debt Settlement Company

If you are unable to negotiate with your creditors on your own, you have several other bankruptcy alternative options to try. For example, you can hire a debt consolidation or debt settlement company to talk to your creditors on your behalf so that your debts can become easily manageable and the repayment becomes affordable. In case of debt consolidation, the company will first convince the lenders to waive off hefty penalty charges and reduce interest rates. They also negotiate a more favorable repayment plan. In the end, they consolidate all your debts and then determine a single consolidated payment, which you must make every month to the consolidator who will further disburse the payments to your respective creditors. The debt consolidation company will charge a certain amount of fee for such services. The debt settlement on the other hand can give you an opportunity to pay off your entire debts by paying a much reduced amount of money as compared to the actual outstanding balance. If it works in your case, you can settle your entire debt by paying just 30-50% of the outstanding balance.

Always remember, bankruptcy must be used only as the last option, when all other bankruptcy alternative options fail to work.

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