Options to Consider Before Filing for Bankruptcy

If you’re dealing with the stress of carrying burdensome debt, being harassed by collection agencies and knowing that the money coming in is not going to cover all the bills that come due, you may be considering bankruptcy. However, it’s important to keep in mind that a bankruptcy filing will have a significant impact on your credit report for 10 years. There are other alternatives to consider first, which include:

• Creating a budget — The first thing you should do if you are facing severe debt is to scale down your spending. Create a budget and decide if items you spend money on each month are things you need versus things you only want. Gym memberships, eating out every weekend and entertainment expenses will likely have to go. You also may have to downsize to a less expensive residence. Try to work out a monthly spending plan that allows you to find savings that can be devoted to paying down debt.
• Negotiating with creditors — If you have a steady income and some assets that can be sold off, you can approach your creditors to negotiate a reduction of debt payments. Creditors may waive interest or accumulated late fees, reduce interest charges going forward and even restructure the debt, since they have an interest in preventing a default.
• Seeking debt management — There are several non-profit credit counseling services, such as the National Foundation for Credit Counseling, that can help you work out a debt management plan that allows you to pay your debts over time, possibly with lower finance charges. However, you should be aware that there are for-profit credit counseling services that prey on people who are under financial pressure and thus are susceptible to scams offered under the guise of credit repair. You should thoroughly research any credit counseling agency before agreeing to work with them.

Pursuing any of these alternatives may allow you to resolve your debt problems without blemishing your credit score. In doing so, you can benefit greatly from having an experienced Georgia bankruptcy attorney work side by side with you. Creditors will be more responsive to adjusting debt if they know you are represented by a lawyer who has studied your financial situation and can show why it may be in their best interest, as well as yours, to resolve the debts without resorting to bankruptcy.

From offices conveniently located in Athens, Douglasville, Gainesville, Lawrenceville, Marietta and Scottdale, Jeff Field & Associates helps people throughout the Atlanta metropolitan area and beyond with bankruptcy and debt-resolution issues. To schedule an appointment, call 404-381-1278 or contact us online.