personal debt tips

Expert personal debt tips to guide you with your money.

Filing Bankruptcy, as a last resort.

Bankruptcy should only be used as the final option after all others have been exhausted. You have many options available to you that you should consider prior to filing bankruptcy for your finances, rather personal or business. You should think, before deciding that bankruptcy is imminent, about a few things. The following list will give you ideas on how to determine if you are out of alternative options.

  1. If your personal debts greatly exceed the amount of money you are able to pay. After you have thoroughly investigated all other options such as refinancing, consolidating your debt and the various other options available, and you have received advice from a professional, that there are no other alternative, then filing bankruptcy might be your only choice.
  2. If you own a business and it does not generate enough revenue to support the bills and overhead, this could be your only option. The bright side of this, is that if you do file bankruptcy, your business may not have to close its doors. When you file bankruptcy, it essentially shields your business, which effectively gives you leeway to get it back in shape.
  3. It is extremely important that you educate yourself extensively on filing bankruptcy and all of its options. It is possible that the only step you are able to take is bankruptcy; however, you should know for certain that no other option is available to you.

One Bankruptcy Alternative, Settle Out Of Court.

As it was stated earlier, bankruptcy should only be used as a last resort. Therefore, settling a debt out of court could be an excellent option. If you have already started the process of bankruptcy, it is likely someone has pointed you in the direction of arbitration or towards negotiating outside of the courtroom. You should use this option wisely, because more often that not, the results of these actions could lead to an agreement where everyone involved is satisfied.

It is not advisable to handle these out of court proceedings on your own. You should consider hiring an independent company that can help you with all the negotiation between your and the creditors. It is very important to hire a company that is experienced and has an excellent reputation. You should always obtain their references and check them out, this should be coupled with contacting the Better Business Bureau and investigate if any consumers have filed complaints. These are all important steps because, it is your credit on the line and all of these actions will have a direct result upon it.

Obtaining an Attorney to Help with Filing Bankruptcy

If you have gone through the process and determined that declaring bankruptcy is your only option, the first step you should take is to hire an experience and reputable attorney that specializes in bankruptcy. An attorney that specializes in bankruptcy keeps him or herself current on all of the laws within your area and should bring to you experience that will help you with all the filing, in the correct manner. You should be aware that you will definitely have to pay a substantial fee to hire a reputable bankruptcy attorney, be comforted by the fact that the costs may certainly be worth the results.

It is necessary to contact the bar association within your area, they will refer you to a bankruptcy attorney. The bar association will typically only refer attorneys that are in good standings. Most of today’s bankruptcy attorneys offer free consultations, take advantage of this. During this consultation, the attorney will listen to you, examine your records, and be able to inform you as to whether or not bankruptcy is right for you.

During the consultation, take this time to get a feel for the attorney. Ensure that you are comfortable with them and that you fully understand all the fees he will charge you, as well as, the schedule in which he requires you to make payment on the fees. As it was stated earlier, bankruptcy should only be used as a last resort, if you have no other choice but to declare bankruptcy, be certain that you hire a true professional to guide you through the entire process.

A Personal Alternative – Debt Consolidation

A debt consolidation service is perfect if you find yourself having a large amount of debt, this could be a wiser option for you than filing bankruptcy. Generally, if your personal credit is still stable, you will be able to obtain a good interest rate and have the ability to consolidate all of your creditors into one.

Many people are unclear as to what debt consolidation really is. Debt consolidation is a loan from a finance company that is used to enable you to gain back the control of your financial situation and essentially helps you avoid bankruptcy.

Obtaining a debt consolidation loan helps you simplify the payment process of your bills. For example, if you have a great amount of credit cards or loan payments, this loan allows you to consolidate all of them into one monthly payment. The goal of debt consolidation is to help you get back on track and making full and timely payments, it will allow you to make one payment of one amount each month until they are paid off.

In some cases, it is likely that one of the credits you already have will help you in obtaining a debt consolidation loan. These credits have high stake in helping you avoid filing bankruptcy, if you file bankruptcy they essentially lose their money. Therefore, if bankruptcy has become an option one of them will likely lend you more money to pay off your debt. It is extremely wise to seek the advice of an expert to determine if debt consolidation is an option for you.

Do Not File Bankruptcy Find an Alternative.

Many people see declaring bankruptcy as the easy way out. In reality filing bankruptcy can result in more costs for you in the end. There are many long-term damages that can arise out of filing bankruptcy, before you make your final decision you should examine all options. The following list contains suggestions to help you begin.

  1. First think about why you feel bankruptcy is an option. Do you possess an extreme amount of debt? Do creditors call or visit you on a daily basis? There are options available to you that include seeking the services of a credit counseling company. They are in business just to help you get your financial situation in order and back under your control. The greatest aspect of avoiding bankruptcy is to learn better control and gain better spending habits.
  2. Use the internet to your advantage. The world of the internet contains a vast amount of information about bankruptcy and finding alternatives. If the internet does not help you, many different service providers would be willing to help you find a suitable alternative to bankruptcy.
  3. It cannot be said enough to obtain the services of a professional. They are educated in the ways and laws of bankruptcy and all of the alternatives. They have the ability to help you determine all the effects that filing bankruptcy or using an alternative will have upon your life and your credit, the good, the bad and the ugly.

Three Questions to Consider When Using an Alternative.

The following are a few tips that you should seriously consider before you declare bankruptcy. These will help you decide if bankruptcy is right for you.

  1. Have you contacted a professional financial advisor? Always gather all information from a professional prior to taking the last step and filing bankruptcy. Ensure that you have no other alternatives available to you, other than declaring bankruptcy.
  2. Are you aware of the long-term consequences of filing bankruptcy? Filing bankruptcy instantly destroys your credit and remains there for up to a seven-year period.
  3. Did you seriously consider all alternatives? Many people find themselves deep in financial debt that they become desperate to relieve themselves of it. While it may seem to be the easy way out, believe that it is not. There are many alternatives you should consider and feeling like there is no way out could lead you to making a bad decision. Again, thoroughly examine all options available to you and talk to several different people for professional opinions. Do not do anything in haste and later realizing it was not the best choice for you.

Knowing what you need to file bankruptcy.

The following are a few tips that you should seriously consider before you declare bankruptcy. These will help you decide if bankruptcy is right for you.

  1. Have you contacted a professional financial advisor? Always gather all information from a professional prior to taking the last step and filing bankruptcy. Ensure that you have no other alternatives available to you, other than declaring bankruptcy.
  2. Are you aware of the long-term consequences of filing bankruptcy? Filing bankruptcy instantly destroys your credit and remains there for up to a seven-year period.
  3. Did you seriously consider all alternatives? Many people find themselves deep in financial debt that they become desperate to relieve themselves of it. While it may seem to be the easy way out, believe that it is not. There are many alternatives you should consider and feeling like there is no way out could lead you to making a bad decision. Again, thoroughly examine all options available to you and talk to several different people for professional opinions. Do not do anything in haste and later realizing it was not the best choice for you.

Bankruptcy and Filing is State Specific

Where you live will directly affect the way that bankruptcy is filed. No matter where you live and file, a few things remain the same. The following is an example of the bankruptcy process.

  1. Make sure you have all necessary paperwork. The proper documents will include a full list of all income you maintain, as well as any assets you hold. Income includes any wages made from employment or other financial gains, assets include vehicles and any property you posses. You will also need to obtain all of the general living expenses for one entire month, tax documentation, as well as all of the debt you have incurred.
  2. Retain an attorney; there are many forms that must be filled out when filing bankruptcy. There is an extreme amount of information required to declare bankruptcy and an attorney can offer you his or her experience to ensure that you are filing all the proper paperwork and are not missing any important information.
  3. Once you have filed for bankruptcy an automatic stay will occur. An automatic stay is a process that prevents any foreclosure procedures, as well as preventing bill collectors from calling you and all loan repayment activity.
  4. When you file your bankruptcy petition you will be assigned a ‘Bankruptcy Trustee’. After you have filed the court gains all control over your property and debts. The job of the bankruptcy trustee is to thoroughly review all the paperwork you have filed and if they see any part of the petition that seems out of order or incorrect that have the ability to challenge it.
  5. Shortly after you have filed for bankruptcy, the assigned bankruptcy trustee will conduct a meeting with you and your creditors, which will likely be their attorney or representative. Within this meeting if any of the creditors object to any aspect of the meeting, negotiations will begin between you and/or your attorney and the objecting creditor. If no agreement can be decided upon, a judge of the court will be the deciding factors on each issue not agreed upon.

A Personal Alternative to Bankruptcy – Credit Counseling

Credit counseling is a credible and viable way to avoid bankruptcy. Credit Counseling is generally offered free of charge along with various other services that can be provided. Services provided by a credit counselor include education on issues such as money and credit management, budget counseling, debt management assistance and housing counseling.

Examine any credit counseling service that you are considering, contact the better business bureau and ensure that they are in fact a reputable company. Keep in mind that just because they say they are, does not always mean it is true. This step is extremely important, because you will be providing the credit counselor with all of your private information such as social security numbers, credit card accounts, and other such private matters that you should be very protective of. Do not just hand over this information to just anyone, do your homework and find a company that has a solid history.

A Bankruptcy Alternative – Liquidation

Liquidating your assets can help you get much needed cash to pay off debts that may seem to be drowning you. Some things like your home, or if you possess only one vehicle, are not assets you can liquidate for the simple reason you need them in life. However, if you own more than one vehicle, or any other assets of value, you should consider liquidating these to help yourself out of the hole of debt. Many people like to have the best in life, such as fancy vehicles, or brand name jeans, in the end all of these are just vehicles and jeans and nothing more. Such things can cause you to dig deeper into financial debt, these are things that should be liquidated or simply avoided. Things that you do not absolutely need to survive should be taken into consideration. If you live in a home too expensive for you, consider a cheaper home. If the vehicle you drive carries a higher payment than is suitable for you at any point, consider trading it for a less expensive vehicle. Liquidation is a big step to consider before taking the final step towards declaring bankruptcy. Rid yourself of things you do not absolutely need, the monetary gain from these items can very well help you pave a better road to success in financial management.