Alternatives To Bankruptcy In Kentucky KY
Debt is like a financial whirlpool sucking money down a black hole at times. It may seem impossible to escape debt under such circumstances. Most people stuck in debt often consider bankruptcy as the only way out. But if you are struggling with debt and considering bankruptcy, you have come to the right place.
There have been over 682,383 bankruptcy filings in the United States over the first half of 2020. 659,881 of these bankruptcies are personal. These numbers represent a lot of financial and emotional pain and hardship. Financial experts predict that bankruptcies could escalate due to the economic downturn resulting from the Covid-19 pandemic.
Your big debt doesn’t have to mean total financial surrender. There are many alternatives to bankruptcy to explore before you file for Chapter 7 or Chapter 13 bankruptcy. This article provides information on some of the alternatives to bankruptcy in Kentucky.
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Debt Settlement
Debt settlement becomes an option when your debt is severely delinquent. You may use a debt settlement company or decide to pay off the debt by yourself. The most important thing is to strike an agreement with your creditors to pay less than you owe them. The process involves the creditors forgiving a portion of your debt.
Cash saving is the advantage of this process, while your credit report will indicate that you paid less than the amount you owed the creditors. This step may lower your credit score but save you from a lot of financial and emotional stress involved in paying your full debt. You should be in default for this method to work. Creditors won’t forgive part of your debt if you go on making minimum monthly payments.
Debt Consolidation
This is another viable alternative to bankruptcy in Kentucky. For this method to work, you should have access to a credit line that will let you pay off all of your small debts. You may consider a personal loan or a home equity loan against your property. But you should always keep in mind that your house secures a home equity loan, and you may have to evict the property if you don’t pay such a loan.
Sell Your Assets
Selling your assets is another effective alternative to bankruptcy. Do you have a car that you could sell and pay off your existing debts? What about holding a garage sale? Do you have stocks and bonds with significant value? The higher your assets’ value, the more money you could raise to pay off your debts.
Most people are emotionally tied to their possessions and may find it difficult to sell some of their assets. But your sorrow can immediately turn to joy when you find out how good it feels to be debt-free.
Do Nothing
Surprisingly, this is one of the most effective alternatives to bankruptcy for people deeply in debt and willing to live a simple life with little income and property. You are basically “judgment proof” because anyone who sues you and obtains a court judgment won’t be able to collect their money from you simply because you don’t have anything that they could legally take from you.
A person won’t be thrown in jail just because he or she cannot pay debts. The creditor cannot take away any essentials such as ordinary household furnishings, food, personal effects, basic clothing, and social security.
LET OUR EXPERIENCE GUIDE YOU
Call to schedule your Free Bankruptcy Consultation!