Bankruptcy Lawyer

Bankruptcy is a bleak situation that many debtors try to avoid. Depending on your situation, it may be a good idea to try to find alternatives to filing for bankruptcy if possible. This can help to preserve your credit rating. However, even if bankruptcy is inevitable, it is not the end of the world. No one wants to take all your possessions and leave you with nothing. In fact, bankruptcy laws are specifically designed to allow you to retain enough to get back on your feet.

Here are some options to explore as alternatives to filing for bankruptcy, as well as some of the advantages that bankruptcy has to offer.

Alternatives to Bankruptcy

Before considering filing for bankruptcy, talk with your creditors to see if you can work out some sort of settlement or alternative repayment plan. It is not to the creditors’ advantage to have debtors file for bankruptcy, so many are willing to negotiate another arrangement.

If you still have credit available, you may be able to consolidate your debts. This allows you to make only one payment per month instead of multiple payments that may overwhelm you. If you own a residence, you may be able to take out a home equity loan to consolidate your debts. Otherwise, you can take out a debt consolidation loan or transfer your debts to a credit card with a low-interest rate.

You may also be able to create a debt management plan with the help of a credit counselor. Credit counseling agencies have experience working with creditors and may be able to negotiate a plan where you have failed.

Advantages to Bankruptcy

Even if bankruptcy is the only option, it isn’t as bad as you might imagine. For example, depending on your financial situation, you may have options as to which type of bankruptcy you want to file. Individuals are eligible for either Chapter 7 or Chapter 13. The latter is a reorganization plan for people who have a regular income but whose debts are out of control. It works similarly to a consolidation loan. Chapter 7 is a liquidation plan, but many people find that most of their possessions are exempt. Bankruptcy appears on your credit report for seven to 10 years. Nevertheless, other factors, such as debt-to-income ratio, have a much greater impact on your credit score than that. Once your debts are discharged, you may find that your credit score improves more quickly than you anticipate.

Perhaps the biggest advantage of bankruptcy is that it temporarily stops any collection actions against you with an automatic stay. Find out more about your options for dealing with debt when you contact an attorney, like a bankruptcy lawyer in Las Vegas, NV, today.