If managing your debts is becoming a problem for you, bankruptcy may not be the wisest decision you take. You can avoid bankruptcy and still get your debts fixed. This will indeed give you the needed relief even though this is a fairly new concept. These programs assist you in getting out of debt in 18 to 36 months.
Here are a few ways you can get debt settlement and also avoid bankruptcy:
Ask creditors to help
Contact your creditors and let them know that you are going through a financial crisis. Tell them that you are very much eager to pay back the money but would appreciate if they could settle your debt for a little less so that you can afford to pay. Your creditors would want you to give them back some money rather than no money at all. They would in most probability try and settle your accounts for less, if they find out you are planning to file bankruptcy.
Seek consumer credit counseling
If your creditors have not been co operative, you may seek help from a professional. A consumer credit counselor could help to negotiate with your creditor in reducing the rate of interest on your loan. According to the new bankruptcy laws if you have been thinking of filing bankruptcy, you will have to first seek credit counseling with a professional. So, why not do it yourself?
Ask family and friends to help
Borrowing money from family and friends is usually a bad idea but better than filing bankruptcy. Make calculations as to how much money you would need to pay off your debts. Seek financial assistance from your family and friends and approach them with a payment plan that you have prepared so that they feel that you have good intentions of paying them back.
Settle debts with creditors
If you have a choice between
debt settlement and bankruptcy, the former is the wise choice.
Creditors may or may not be helpful, but the fact is, it is your debt and you are totally responsible to pay it off. So manage your finances accordingly and avoid over expenditure. Unplanned expenditures can cause a lot of financial trouble and may get you into a lot of debt which may be difficult for you to manage in the future.
