Chapter 7 Bankruptcy Lawyer
When debt gets to the point that it cannot be easily overcome, many consumers consider trying a few last ditch efforts before finally accepting filing for bankruptcy may be the only option left. However, bankruptcy isn’t necessarily going to provide each consumer with a debt-free, clean slate. Filing for bankruptcy can impact a consumer’s credit score and financial status for many years to come, so the decision must not be taken lightly.
Before filing for bankruptcy, a consumer may want to consult with a legal professional for advice. After filing for bankruptcy, the work is certainly not over, and many consumers have to work very hard to overcome this setback. Consumers may want to try these tips before filing for bankruptcy:
#1 Selling Assets to Pay Back Debts
Consumers who have assets that aren’t of sentimental value, may want to sell these off as a way to pay back debts. A consumer can sell jewelry, art collections, old electronics, furniture, clothing, cars, and other belongings. While some may feel like is a radical way to pay back debts, it can be hugely influential in helping avoid bankruptcy. Anything that a consumer is willing to part with and has monetary value, may be worth selling.
#2 Re-Evaluate Your Spending
Sometimes all it takes is some awareness of spending habits to help a consumer get back on track to financial stability. The truth is, that just because a person files for bankruptcy doesn’t mean any and all outstanding debts disappear. In fact, if a person files for Chapter 13 bankruptcy he or she may still have to pay at least a portion or the entirety of debts, but payments will be spread out typically over the course of 3-5 years. A consumer who has misconceptions about what bankruptcy is, may be devastated to find out their debts weren’t completely eradicated after filing.
#3 Talk Honestly with Creditors
The creditors you owe money to may rather get something from you then nothing at all. Contact your creditors and inform them that you are struggling with finances and are trying to avoid filing for bankruptcy. State your willingness to pay off the debt, but ask if they can assist in easing the burden by decreasing your monthly payments and/or interest rate. It isn’t uncommon for credit card companies to already have established such programs for those going through financial hardships.
#4 Ask for Support From Family and Friends
Borrowing money from loved ones may not always be the best idea if you can avoid it, since it can have a negative impact on relationships. However, if you are trying to prevent bankruptcy, it may be worth considering asking for assistance from friends and family. Carefully calculate how much you can contribute to paying off your debts, and then ask loved ones if they are willing to help make up that difference. Creating a detailed plan for how you are going to back them back and providing that when you ask, can help loved ones be more open to giving you monetary support.
Source: Chapter 7 Bankruptcy Lawyer Bloomington, IL, Pioletti & Pioletti