Choosing Debt Consolidation Bankruptcy Prevention

by Sean A. Kelly - Date: 2010-11-02 - Word Count: 690 Share This!

There are times in your life where you will simply be forced to make rather difficult decisions that may affect your entire life ahead of you. When it comes to debt consolidation bankruptcy dilemma you probably do not want to take either option but logically you might have to make one choice. Most experts would probably advice against insolvency filing due to the major and severe impact it would have on your credit rating as well as your entire life at least for the next ten years. On the other hand, opting to consolidate your debts carries its own risks as well.

It may not be easy facing a debt consolidation bankruptcy dilemma. However, there are still other ways around the obvious. Insolvency filing is often considered as a last resort option for any financial situation and the best way around it is to prevent it. Of course, prevention may often work better if the problem is detected sooner instead of when it is at the brink of an outburst. With the right attitude and determination you can definitely work your way around having to file for insolvency and you might be able to kill two birds with one stone - you can save your finances as well as your dignity.

When you find yourself leaning dangerously close towards filing for bankruptcy and you simply want to avoid that particular option at all costs, you might be surprised to learn that your existing creditors might be the key to reducing your burden of debts. In fact, your creditors probably may not want you to go bankrupt, any more than you do because, it may cost them a lot of time and money. There is a very big chance that they won't get to see a penny of their money should you go bankrupt. So in this case, the best option for you might be to contact your creditors as soon as possible and talk to them about your situation. Generally, most creditors might be more than happy to work with you to come up with a revised repayment plan to enable you to keep paying them back the money owed at a reduced rate. It would be wise for you to listen to their suggestion, as they probably have had the experience of handling this particular type of situation before.

Some creditors might even lay out a few debt consolidation options for you to go over, in order to come to a repayment agreement. Your creditors might advice you on the best course of action for you to consolidate your debts depending on your specific financial situation. You may have the option of lowering your total debt payments and also organizing your finances with just one payment. However, it is always advisable that you also conduct your own research on the best ways to consolidate your debts so that you might be able to avoid having to file for insolvency. Before you do that, you might want to check your credit report first to know where you stand on this matter. Your credit report might contain vital information for you to know the extent of your financial issues and from there onwards you may be able to figure out how to restructure your finances.

You may also have to shop around for the right debt consolidation programs that will help you benefit more from them. If you are unsure, you always have the option of appointing your own attorney to handle matters for you. Of course, you may have to remember that attorney fees are not exactly cheap. So, if you opt to do things all by yourself, it is advisable that you obtain information on the reputation, experience, performance and all related fees and charges of several debt consolidation companies before you single any one of them out.

All throughout the process of searching for the right debt consolidation program you may find yourself lowering your monthly fees with a waiver of late fees and reduced interest. Iin due time, you could become financially free. So you might want to treat this as simply an annoying road block that you can definitely bounce back from.

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