almost impossible to live without incurring some debts. With the tough economic
times, debt can sometimes be overwhelming. If you are thinking of filing for
bankruptcy, think about how bad it might impact your credit score. Bankruptcy
experts say that there are always other alternatives to save you from such
serious decisions and save your credit rating. Consider the following options
and avoid bankruptcy.
Sell some assets
selling off some of the assets that you can live without so that you can use
the funds to settle your debts. Do this as soon as you notice that you are
struggling with payments. Do not wait for due dates to pass for you to start
considering this option.
advantage of online business platforms to get a ready market for your assets.
For instance, you can get customers for electronics, furniture, and jewellery
fast. If you are sentimental about certain items, you may have to sacrifice
them to save yourself from going bankrupt.
Cut down on some expenses
your budget and consider cutting down on some of the expenses until you manage
to pay off your debts. You can spend less on expenses such as cable, telephone
or television costs for a while.
If you are
not willing to make such sacrifices, look for ways to get additional income so
that you can afford to pay off debts. For instance, you can try to earn from
your hobby, or get a part-time job. Feel free to ask your employer for some
extra working hours to make some overtime and budget your finances wisely.
Talk to your creditors
you owe can also save you from declaring bankruptcy. Talk to the creditors and
be honest about your financial situation. If you admit that you are struggling
to make repayments, they can help you ease the burden by reducing the interest
rate or the monthly payment. Some of the credit card companies also have
hardship programs to assist debtors in such situations. Before enrolling in a
hardship program, ensure that the monthly payment is reduced.
Consider consumer credit counselling
to the bankruptcy laws, every debtor should seek consumer credit counselling
before filing for bankruptcy. A professional counsellor who deals with
creditors can help you get your interest rates or monthly payments reduced.
They can also intervene between you and the creditor to facilitate a debt
management plan. With this plan, you should repay your debt within 5 years
which is enough time for you to find alternative solutions to acquire the
Seek assistance from family or friends
is not the best decision, the people close to you can sympathize with you in
your financial struggle. Before approaching them, spare some time and calculate
the amount of money you need to settle your debts. Consider how much you can
contribute and let them chip in to help you with the difference. You also need
a plan on how you will repay them to avoid straining your relationship with