If you find yourself facing mounting debts that seem to have taken over your life, you may have considered filing for bankruptcy. There are plenty of attorneys out there who will tell you this is a great option. Yet, it can leave a huge negative mark on your credit that can be hard to get rid of. Before you commit to filing for bankruptcy, consider these three alternative methods for conquering your debt.
- Negotiate Your Rates
It never hurts to ask lenders to lower your interest rates or remove extra charges and fees. Reach out to a manager at your financial institutions and explain your situation. If you are paying on unsecured debt, they know you might be able to write off the whole balance in bankruptcy court and may be willing to negotiate with you. You are already paying high rates, so the worst thing that happens is they tell you no and you keep paying them.
- Restructure Your Debt
Debt restructuring is a possibility. One option is to take out a personal loan to pay off other balances, leaving only a single payment and fixed amount of interest. If you aren’t able to secure lending, a debt relief company like Rescue One Financial may be able to help.
- Sell Your Assets
No one wants to be forced into selling off assets to pay their bills, but holding a garage sale or selling a little-used boat may provide enough money to ease your financial strain. If you are in over your head, selling a home can be a good choice to get bills back under control. Use the equity that has built up to pay off balances and start a healthy savings plan.
Bankruptcy is only one option you have for resolving your outstanding debt. Talk to a credit counselor to see if these other options could be a better choice for your situation.