In some cases, bankruptcy can offer a clean slate. However, the actual fact is that it is never an easy thing to solve. Bankruptcy not only makes you part way with your belongings but also affect you future activities such as employment and many more. The worst part is that it can destroy your credit card in the process. About a decade ago the bankruptcy reform law was amended to prevent the filling of the chapter 7 bankruptcy. In the process, there was a limitation to some bankruptcy rights. Due to these reasons, it is crucial that one should find every way possible to avoid bankruptcy. The only way to do this and to safeguard your credit is by creating a budget. After which you should consider directing your entire fund to debt reimbursement. Debt consolidation and negotiation are other factors to consider in this case. They can usually best apply depending on the terms of your debt category.
This article outlines tips on how to avoid bankruptcy.
1.Create a Budget
According to The Ballard Law Group, a financial helping group in Atlanta, this is the first step to consider against bankruptcy. This step will require that you total all your monthly expenses. This includes scanning through your monthly expenses, such as rent, food, utilities, insurance, transportation and many more. According to research, this can be the easiest way ever to avoid bankruptcy.
2.Selling a Portion of Your Assets
In this case, you should sell anything that you do not use much so as to pay off your debt. The quickest way you can do this is by ensuring that you take action immediately you can’t pay. Most people have fallen into bankruptcy for ignorance. As a result, they have found themselves being behind on payment.
3.Ask For Help from Creditors
It is important that you express yourself fully to your creditors in terms of your debt. Explain to them about your financial difficulties so as to help you avoid bankruptcy.
4.Look for Consumer Credit Counseling
The help from professionals can add up to a good result at the end. The professionals are able to use their experience to convince your creditors to reduce your payment and interest rates.
5.Seek Help from Family and Friends
Your friends and family members can offer support when it is needed. You can ask for a low interest funds from them and return after you have settled your debt.
6.Settle With Creditors and Debt Collectors
Though it is not the right thing to do, a time comes when you have to settle debt through the settlement companies. However, it is better if you consider doing it right to avoid over spending money.
7.Charity Grants
There are times when you might be entitled to the benefits or help from charity endowments. It is, therefore, better if you consider checking to see if you might earn something to clear your debt.
8.Side Jobs
Consider doing other jobs as part-time work to enable ease in paying your debt. This can apply well in the evening or during the weekend when you are off from work. These jobs might be wearisome but are an additional income to avoid bankruptcy.
9.Finance Control
It is important that you take control of your finances in this situation. This is by ensuring that your post is opened and responding to the court papers.
10.Seek for Mortgage rescue scheme
This mostly applies to those who pose a risk to lose their home to auctions. Through the mortgage rescue team, the organization buys your home where you can re-rent it back.
To conclude, mortgage modification might be good but in real sense, it does not help as much as filing for bankruptcy. This is because, to save your possessions, there is need that you save as much as you can to enable you escape the bankruptcy.