5 Ways to Avoid Filing for Bankruptcy

June 16, 2012 by  Filed under: Bankruptcy 

According to Dave Ramsey, bankruptcy is in the top five worse things that can happen to you in a life time. It stands near divorce, illness, disability and loss of a loved one. After all bankruptcy can also be considered the loss of love one called money. People who go bankrupt suffer depression and different other feelings related to depression.

In the United States we could witness a severe bankrupt period. When a business goes bankrupt, the owner will have to declare complete legal insolvency. In the end they will become overwhelmed by their debts and have no way out.

One step to prevent bankruptcy might be negotiating your debts. Be very careful because this tactic is quite dangerous for individuals. A debt consolidation might be the key; it represents an arrangement with the lenders. They will repay all you debts without losing any assets and after that they will consider that a loan which you will have to pay monthly, only it will have a lower interest rate.

The debt settlement is quite the same with the debt consolidation only that now the person will have to negotiate a settlement with the creditors. You might have to make larger payments in order to cover your loses and the time gap, but in the end it will all work out.

You could also sell some belongings and in this way you will have money to pay your debts. There are many things that you can sell before you declare bankruptcy like your second car and that antique collection that you have and belonged to your mom, the house or any valuable assets. You do not need to sell the clothes off of you, only the valuable things that will later help you. In this way you can be again on the floating line and your business will do just fine.

If you find yourself in a bankruptcy situation you do not have to feel ashamed. It could happen to anybody and try to seek help as soon as possible. Te best people who will be able to help you are your relatives and friends. Do not feel weird; if they can they will help you. You can ask them to lend you money and tell them that you will also pay the interest or try to make some small deals with them and at the same time, make them realize that if you still go bankrupt you will not be able to pay them back.

One other thing that you can do in order to avoid bankruptcy is to refinance your mortgage and other payments that you have. If you will pay less every month, you will be able to save some money. If you can decrease your expenses, all will be settled.

And last but not least you will have to make great sacrifices. You might want to stop dining out or going to the movies every other night, if you give up all the unnecessary expenses you will have more money to work with. Pay your bills instead of having fun at the mall. If you start living within your means savings will add up and you will be able to get all the things that you have been dreaming of.

If you feel you are going bankrupt make sure you take all the precautions out there because once you are in the whole, there will be dirt over you. You will see that after you change your lifestyle you will also be happier.

My name is Krzysztof Wasilak. I try to connect my passion (writing) with my daily job (bank employee) and create something valuable for the community. I hope you find my articles very useful! You can see more articles from me on FinestFinances.com

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