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Settle out of Court

It’s always preferable to settle your debts out of court rather than file for bankruptcy. Debt arbitration is a great option as, more often than not, an agreement is reached that leaves both parties satisfied. To get the most out of negotiations, consider hiring a professional who has experience in the debt arbitration process.

Debt Consolidation

A debt consolidation service is perfect if you find yourself with a large amount of debt. Generally speaking, if your credit is still stable, you’ll be able to obtain a decent interest rate.

A debt consolidation loan can help you gain control of your financial situation. You can consolidate all of your debts into one monthly payment, which is much easier to keep track of.

Companies are likely to assist you with debt consolidation because if you were to file bankruptcy, they will not receive any portion of the money you owe them. With consolidation, they are still getting payments.

Credit Counseling

Credit counseling is a viable way to avoid bankruptcy and is typically offered free of charge. During counseling, you’ll get assistance with things like budget assistance and credit management.

As you will be providing sensitive information to your credit counselor, you’ll want to carefully choose who you go with. A great resource to put to use is the Better Business Bureau. Be sure to check out any reviews of the company in question as well.


Liquidating your assets can help you get much-needed cash to pay off debts. While you’d want to hang onto your home for as long as you can, unless of course, you live in an expensive house that is out of your means, take a hard look at the more expensive things in your life. Next, determine what is vital. For everything else, considering selling it. Remember: you can always buy another fancy car down the road but it takes years to get your credit score back on track should it take a hit.

When to Consider Bankruptcy

Remember, filing for bankruptcy should never be taken lightly. If you have explored all other alternatives and are still in a considerable amount of debt, it may be time to start researching what bankruptcy would mean for you.

Where you live will affect the way bankruptcy is filed, as it’s state-specific, so be sure you put together a detailed checklist before getting started.

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 experienced attorney that specializes in this area.

It’s likely you’ll have to pay a substantial fee to hire such an attorney, but many find that the peace of mind that comes with it is worth it. A great place to start your attorney search is to contact the bar association. They’ll be able to refer to a bankruptcy attorney in good standing, many of which offer free consultations.