Avoid Filing Bankruptcy - What Are the Best Alternatives to Filing Bankruptcy?

Added: (Thu Mar 04 2010)

Pressbox (Press Release) - If you want to get out of debt, don't automatically opt for bankruptcy. Before focusing on some of your bankruptcy alternatives, it is important to familiarize yourself with all the reasons why bankruptcy isn't a good idea. We have been trained to believe that bankruptcy is the best way to seek debt relief, but here is why it actually isn't a good idea:


You might need to hire a lawyer.
Taxes, child support, and alimony payments aren't included.
Some of your debts can be refused (meaning you are still responsible for them).
Your credit score will suffer for around seven years.
Now that you are familiarized with some of the downsides to filing for bankruptcy what are some of your good alternatives?


Debt Settlement
Settlement is one of the closest forms of debt relief to bankruptcy. The good news is that it comes without all those cons or downsides. Instead of being absolved from most of your debts, you get a percentage of your debts eliminated. So lets say that you owe $15,000 in credit card debt right now. After going through a settlement, you might walk away only having to pay $7,500.

You might be some of those people who are thinking "why would my credit card companies agree to settle for less?" This is a common question asked and the answer is quite simple. With this form of debt relief, you still need to pay a percentage of your debt. What this means is that your creditors do get some of their money.


Debt Consolidation
When it comes to not having your credit score negatively impacted too much, consolidation is one of your best debt relief options. This is because your consolidation company will pay your creditors the money you owe them. On your credit report, it will show that these were paid in full. So what happens to the money you owe? Your consolidation company will give you a new loan. As long as you make these on-time payments, your credit score shouldn't suffer.

In conclusion, settlement and consolidation are just two of your bankruptcy alternatives. Of course you can decide to opt for bankruptcy, but be sure to keep those above mentioned method cons in mind. Moreover, at least consider contacting a debt relief company that specializes in consolidation or settlement before making your final decision.

If you are over $10,000 in unsecured debt you really should consider getting a debt settlement. Creditors of unsecured debt are fearful of collecting and they also have stimulus money to make debt settlements financially feasible for them. Once the economy turns around it will be too late to eliminate your debt. Check out the link below to locate legitimate debt relief companies in your area:


Free Debt Advice
(http://www.CreditCardDebtSurgeons.com)