Alternatives to Bankruptcy
Although bankruptcy is an option to help you handle your personal or business debt; bankruptcy should be regarded as a last resort option. There are thousands of people who have chosen bankruptcy over a bankruptcy alternative simply because they lacked information about their options.
There are a number of different strategies for handling debt. Please review the list below to learn more about your options.
- Contact your creditor(s), ask for their cooperation, and try to work out different payment arrangements or options.
- Turn to the Consumer Credit Counseling Service, a nationwide nonprofit organization that will work with you and your creditors to devise a more manageable repayment plan suited to your specific financial needs.
- See any of your assets that have a resale value and apply the proceeds to your debt. Any balance due can be negotiated with the creditor.
- Consolidate all outstanding debts into a single loan. This approach relieves you of being saddled with debt from multiple creditors, since you will be making payments to only one lender. Click here to apply for Bryco’s debt consolidation program.
Disadvantages of Bankruptcy
Bankruptcy is not a “get out of debt free” card. Here are some of the disadvantages of declaring bankruptcy:
- You must file the claim and pay a fee. Many times it is necessary to hire a bankruptcy attorney which can be very expensive.
- Some debts cannot be eliminated by declaring bankruptcy, including taxes, student loans, alimony, child support, debts that resulted from fraud or willful injury and some property settlements, fines and penalties.
- Your bankruptcy will remain on your record for up to ten years. This may make it difficult or even impossible to obtain a credit card or a loan.
For these reasons, bankruptcy should be used only when there is no other solution. However, the law forbids discrimination against those who have filed for bankruptcy, so you cannot be denied a job, public housing or a driver’s license on this basis.
