subject: Filing For Bankruptcy - 3 Debt Relief Options To Consider Before Filing For Bankruptcy [print this page] Filing For Bankruptcy - 3 Debt Relief Options To Consider Before Filing For Bankruptcy
Every debtor wants to get rid of his debt quickly and effortlessly. If you are in the same situation and opting to file bankruptcy at the very initial stage it means you are failing to notice the other three more consumer-friendly and reasonable options. I will discuss these three options in the rest of the article and in the end you will surely opt for one of these instead of bankruptcy.
In the past bankruptcy was an easy way to get rid of your debt but not now! Government has made new laws and regulations that make bankruptcy more complex and unwanted while these laws have made the alternatives more popular.
The first and foremost thing is revising your budget and expenses. Due to recession, income has declined and paying you debts back has become harder than ever. It is better to cut down the expenditures and start saving money to pay back the outstanding dues.
The first and most fruitful option is Debt settlement which can reduce your debt 50 to 70% without much of an effort. This relief program involves hiring of a debt settlement company which will do the rest of the job. The settlement company will assess your fiscal situation by reviewing all the financial documents including your total liabilities, utility bill, monthly income and court charges etc.
At the initial stage the settlement company sends an initial letter to the creditor informing that the debtor has gone for settlement and all the communication should be directed towards the settlement company instead of the debtor. After getting a clear picture of your financial situation the company will figure out a repayment plan and offer the creditor a reduced amount of the original debt. Due to the benefits offered for the creditors offering debt settlement, by the government, the creditor easily agrees to the settlement.
Debt consolidation is the second relief option for the debtors. This option is most feasible for the debtors who have multiple outstanding dues. In Debt Consolidation the debtor gets one big loan, usually a secured loan, and pays all he outstanding dues at once. The interest rates and monthly installments of this loan are much more reasonable, as it is taken against an asset.
Credit counseling is the third option for the debtors looking for salvage. It involves formulating a Debt Management Plan by negotiating with the creditor to adjust their recuperation system and agree to monthly minimum payments on smaller interest rates and flexible schedule for the consumer. The Credit Counselor will also advise you methods to bring down your everyday expenditure and amass the amount to compensate to the creditor.
Debt settlement is a viable option to filing bankruptcy and is becoming increasingly popular amongst Americans with over $10k in unsecured debt. Creditors are ready to negotiate. You can literally eliminate 50% of your unsecured debt with a settlement. Check out the following link to locate legitimate debt help in your state.
