Getting On The Right Side of FinancesGetting On The Right Side of Finances

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Getting On The Right Side of Finances

There aren't many things more intimidating than looking at a bank statement and realizing you don't have a dime to your name--despite your best efforts. I found myself in this precarious situation about a year ago, and I didn't know what to do next. I realized that if I didn't make some serious changes and fast, I would be in even more trouble with the law, so I started moving towards making some changes that would actually help. I met with a bankruptcy attorney, and we talked about how to wipe the slate clean. WIthin a few months, things were better. Read more about bankruptcy on my blog.



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Other Options Apart From Chapter 7 Bankruptcy

If you are in debt and want to consider filing for Chapter 7 bankruptcy, there are other options you should consider. Your bankruptcy attorney will take you through the best alternatives to filing Chapter 7 bankruptcy. Here is a review of some alternatives to Chapter 7 bankruptcy.

Debt Consolidation 

A common option to Chapter 7 bankruptcy and any other type of bankruptcy is combining debt. Repaying debts is easy if your whole debt amount is consolidated into one payment. The main debt consolidation options are debt consolidation loans, transfer of debt, and consolidating your debt with a home equity line.

Using a debt consolidation loan entails combining all separate debts into one. While you still owe the same amount of debt, the interest rate and monthly installments are minimized. This is better than making separate payments to different creditors.

Transferring your debt to a low-interest credit card is another popular option. There are credit card companies with low transfer rates. This means the transfer terms maintain a low-interest rate until the debtor pays the full amount of the debt. As a result, the debtor will pay a low-interest rate during the term of repayment.

Lastly, you can opt for a home equity loan. If you have equity in your home, you can get a low interest and tax-deductible loan. However, be careful when securing a loan against real estate, as defaulting on the debt means losing your property.

Debt Settlement

Debt settlement involves getting into an arrangement with all your creditors to pay them less than what you owe them. Debt settlement is ideal if you have several creditors. You will be able to raise enough cash to pay all your creditors. However, to win over your creditors, you should be able to settle the debts with one lump sum payment when the agreement is reached.

Chapter 11 Bankruptcy

If you are engaged in business, your priority is to remain in business and avoid liquidation. In this case, Chapter 11 bankruptcy is your best option. Under this bankruptcy code, you are seeking an adjustment of debt. This may be by reducing your debt or getting an extension for repayment. This option works for partnerships, corporations, and sole proprietorships.

Some sole proprietors also qualify for Chapter 13 bankruptcy. This form of bankruptcy can help you save your home from foreclosure. As an individual debtor, you can catch up with past-due payments by committing to a payment plan.

For more information, contact a company like DiFatta Law Offices LLC.