Whether you are employed or you earn an income from doing business, there comes a time where borrowing is inevitable. In most cases, we borrow money to fund emergencies and financial obligations that would otherwise take some time to finance from our regular income. Nonetheless, loans are also available for various luxuries, including flashy cars, luxury travel, and so forth.
As long as you can comfortably pay back the borrowed money, taking a loan is never a bad thing. However, many people find themselves entangled in debt situations, and all of a sudden, their reputation and peace of mind are at the mercies of the lenders. Without carefully planning your finances, you could easily get into the sinking sand where you are drowning in debt.
But can you get out of debt without filing bankruptcy? The answer is yes you can. This article provides enlightenment on how you can get out of debt without necessarily having to file bankruptcy.
Understand What Bankruptcy Is?
In most cases, people take a bankruptcy to mean financial ruin, as in the case of being declared bankrupt. Well, there’s more to it than meets the eye. Rather, filing bankruptcy can serve as a way out of the crushing effects of debt among individuals and business entities. However, sometimes it’s best to weigh your options carefully before filing bankruptcy. As advised by Ohio bankruptcy lawyer Julius Amourgis and his team of attorneys, you need an experienced lawyer to determine if filing bankruptcy is the best option. Apart from this, the expert attorney will ensure that your bankruptcy petition goes smoothly in court.
Avoid Unnecessary Spending
Debt can be a real nightmare. It can cause you sleepless nights. It’s one of those things that sneak into your life without notice. Filing for bankruptcy can be very traumatizing, but it is not the only option if you are drowning in debt. Cutting down on your wants and focusing on the needs is one way you can get out of debt without filing bankruptcy. Consider lessening your spending and cutting off the unnecessary expenses eating into your budget. Prune out the wants and ensure your budget is only catering to the needs. Use the saved amount to chip into the debt. You also need to make some painful sacrifices on your end. For instance, if you are used to dining in fancy restaurants every weekend, consider cooking a healthy meal for your family at home until your debts are settled. This also means trimming your budget and creating one that you can stick to until your debts are paid off.
Talk To Your Creditors
There are many ways in which you can kill a rat. Filing for bankruptcy is no child’s play. However, with responsible financial planning, you can offset your outstanding debt without filing for bankruptcy. One of the many ways in which you can settle a debt is consulting and negotiating with your creditors on a relaxed payment plan. Firstly, express your desire and willingness to pay the debt to your creditors. Then try and negotiate with them on an affordable monthly payment plan. You can also request the lowering of the interest rates etc. Be honest and explain to them the challenges you are having in paying the debt. Who knows they might be willing to work with you and possibly give you more time to clear the debt.
Sell Some Assets
Assets are some of the precious valuables we hold dear. However, certain situations can force you to get rid of your treasured assets during financial difficulty. Selling your assets is one option that you can explore. You can use different websites for auction or social media platforms to sell your assets. Sell whatever you can to ease the pressure. It may cost your comfort, but, remember, it is only temporary. It could protect you from filing for bankruptcy and perhaps help keep your reputation intact. Assets you can sell may include cars, furniture, jewelry, land, and antiques that have the potential to fetch some good money.
Get help from Family and Friends
The strain that comes with filing for bankruptcy can be quite overwhelming. Drowning in debt can be a tall order. It leads to emotional stress, which can be difficult to manage. Borrowing cash from friends or family can be demeaning, and uncomfortable, it’s the last thing you want to do. However, when push comes to shove and the ugly face of bankruptcy is glaring right at your face, your options become limited. Explain your situation and let them know when to expect their money back. They might not lend you the whole amount but whatever they will offer will go a long way in offsetting your debt.
The thought of filing for bankruptcy can create tremendous levels of uncertainty in one’s life. It often brings about depression, anxiety, and other mental problems. From the above piece, we can safely conclude that, when seeking to get out of debt, bankruptcy is not the only option.