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Bankruptcy Isn’t Always the Only Choice

By: Cecil Flynn

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In the rough economy we face today, it seems that more and more people are having financial problems. With all the unemployment we see, many people are facing foreclosures and severe credit issues. Along with these credit problems, there are more debt relief ads showing up each day as well. But do the people behind the ads really have your best interest in mind?

Usually the ads you see for credit help are from attorneys who want to help you file for bankruptcy. These lawyers usually make a good deal of money from bankruptcy filings so of course they will encourage you to file. However, is bankruptcy your only option? Unfortunately the attorneys will have you believe that there is no other way out. By filing you will ‘start fresh’ and be able to breathe easy again.

But is that really true? In fact people with a bankruptcy will have that fact follow them on their credit report for the next seven years. Many times it will haunt you even longer as potential employers or credit companies look into your past. Often, credit applications will ask if you have ever filed for bankruptcy. Even if it has been over seven years you will need to be honest and state that you have. If you don’t it may hurt your credit further when the creditor finds out your have lied.

Rather than have a bankruptcy on your credit report, explore other options for getting out of debt. If you own your home and have equity, consider a debt consolidation loan with your home as collateral. Now you should only do this if you have are secure in your employment. You do not want to put your family home in jeopardy. By using your home to secure a consolidation loan, you may be able to deduct the interest payments on your income taxes.

If a debt consolidation loan isn’t an option for you, consider a non-profit credit counseling service. These services will work with you to reduce your debt and can help lower your monthly payments and even get interest rates reduced. Make sure you research the company with the Better Business Bureau before you give them any money or personal information. While most credit counseling companies are trustworthy, there are a few that are not.

Another option you may want to consider is to raise the money yourself to overcome your debt. If you search the internet you will find hundreds of success stories of people who have paid off tens of thousands of dollars of debt in just a few short years by themselves. These people have made cuts in their lifestyles, picked up second jobs, and held garage sales to get rid of things they don’t really need. They make sure every dime of the income generated from these activities goes toward the debt.

You don’t have to drown in debt and bankruptcy isn’t the only answer. Take the first step to financial freedom. Cut up the credit cards and make a plan to get out of debt. When you are finally debt free you will be glad you did it yourself instead of filing for bankruptcy.

Article Source: http://depositarticles.com/

Cecil likes doing projects in the yard and doing projects around the house. He uses a Rubbermaid utility cart help him haul his tools around the garden. Cecil loves reading and trys to learn something new every day about his favorite topics such as retirement planning and composting.

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