Don't File Bankruptcy Unless You Have To PDF Print E-mail
Written by Daniel R. Michaelson   
Friday, 03 July 2009 11:26
Bankruptcy is one of those resolutions that only needs to be utilized as a last resort. There are so many ways to avoid it, most people don't think about it. Divorce is a huge arena where people are quick to file because they don't or can't work things out. Instead of researching all the ins and outs of bankruptcy, many people believe it's the easiest solution. However, there is no easy way out, which is why it is extremely important to review all your other options.
by DanielR.Michaelson


Bankruptcy is one of those resolutions that only needs to be utilized as a last resort. There are so many ways to avoid it, most people don't think about it. Divorce is a huge arena where people are quick to file because they don't or can't work things out. Instead of researching all the ins and outs of bankruptcy, many people believe it's the easiest solution. However, there is no easy way out, which is why it is extremely important to review all your other options.

Doing Nothing May be Your Best Answer

Through the years many people have realized the importance of taking action when the chips are down. You may feel as though you have to do something in order to make progress, but that's not always the case. In fact, when it comes to bankruptcy sometimes the best thing to do is nothing at all. See, creditors have to spend money on attorney fees and take you to court if they want to see any money back. It could cost them thousands of dollars and if they notice your balance is less, they probably won't sue you.

No Money to Give

While there are many people who are just lazy about paying their bills, there are some who just can't. You may fall under this category where you want to get rid of the creditors, but can't come up with the funds to do it. What creditors do is look at the whole landscape of your credit. If you owe three different companies $500, $1000, and $2500 they even try. Why? Well, the money would barely cover their legal fees and then they have to worry about actually enforcing the ruling.

Even if they won, they would need to look into getting it enforced! Remember that most of your budget is completely out of the creditor's reach. For instance, they can't touch you clothing, furnishings, food money, Social Security payments, unemployment, public assistance and even 75% of your wages. Even if you pay the two higher amounts, it is unlikely that you will get taken to court! The truth is that sometimes doing nothing at all can result in your case getting written off.

While this is a huge benefit, you have to remember to keep from acknowledging anything. Anytime you do talk to a collector, make them aware that you have no recollection of any debt. This way the statute of limitations is still under effect and won't start over if you acknowledge that you owe them money.

How To Negotiate Away Your Debt

Even though we wanted to cover this, we know most people won't take advantage of it. There is something about having to call up creditors and asking them for a lower overall cost. Just remember though, for those that do utilize this, most companies want to settle out of court. Just knowing the smallest details such as this could change the way you think about filing for bankruptcy.

Remember, just because you talk with a bankruptcy lawyer doesn't necessarily mean you're going to be needing one. Let them know that you are dead set on trying to avoid bankruptcy. Once you do this they'll be able to create a debt settlement plan for you. While it can be done formally or informally, it's important to take the first step in resolving the matter.

There is a lot information that you might need when you want to look into debt settlement and credit counseling, and this is where you can turn to a reputable company like Nationwide Debt Solutions. There are many options open to you before you need to think about bankruptcy, so see what steps you can take to preserve your financial future.

DISCLAIMER: This article is provided as information only and is not to be taken as financial advice.

This article was written by Daniel R. Michaelson, a 20-year authority in the debt consolidation industry. Daniel has been helping consumers through his endorsed debt settlement program.