It’s a lot easier to get into debt than to get out of it. Some people get to a point where they think that bankruptcy is their only option for debt relief. In certain cases, that may be true. However, there are several alternative options for debt relief in Athens, GA, no matter what kind of debt you’re facing.

By taking a minute (and a deep breath), and learning about all of the options for handling your financial distress, you’ll immediately feel relieved and hopeful that there’s an effective solution out there for you. After all, bankruptcy is effective, but it can be costly in more ways than one. You can take a huge hit to your credit score, risk being unable to borrow money, or even put your ability to get a job at risk.

There are a lot of ways you can find relief from debt, but they generally all start by finding someone to help you along the way. The experienced team at Morgan & Morgan can help with all manner of debt relief, including bankruptcy, consolidation and settlement plans, and more.

 

Alternative #1 – Debt Settlement

Debt settlement is an option that is available to anyone who is in default with their creditors. After all, if you get to the point where you have to file bankruptcy, the creditors might not see a dime. Therefore, it could be in their best interests to settle now and at least get some of what they’re owed.

You can attempt to settle debts on your own, but it’s often better to have an expert negotiating on your behalf. A debt relief lawyer can be a great resource in this instance, as they know how to get the best offers from creditors of all kinds. Keep in mind that settlements will still show up on your credit report and may even say something like “settled for less than owed” or “closed, partial settlement” which indicates it was a defaulted debt in some capacity.

The benefit of settling debts is that it’s quick compared to other options, and you can often negotiate different agreements with each creditor. Plus, it costs less than bankruptcy, even when you include paying someone to handle the settling on your behalf.

 

Alternative #2 – Debt Consolidation

Debt consolidation is another alternative to bankruptcy, but it might not be available to everyone. To use this method, you must be able to qualify for a loan or line of credit that you can use to consolidate your debts into one lump sum payment. If you aren’t too far in debt, you may be able to get a personal loan from a bank or credit union.

Some people will take out a home equity loan or line of credit to pay for their debts, but you’ll need to make sure that the terms of this are agreeable if you go that route. Again, it’s a good idea to have a debt relief lawyer on your side to help you figure out how to proceed with consolidation.

You might even decide just to set up a debt management program and use that to pay off your debts. If you do this, you’ll be able to make one monthly payment and have it dispersed to your creditors on your behalf. You may not have as much control over which bills get what funds in this case, but it will be a good way to get rid of high-interest rates and other fees and expenses.

This also combines all of your debts, which eliminates the risk of one being overlooked when you’re making separate payments.

 

Alternative #3 – Credit Counseling

Credit counseling in and of itself isn’t going to eliminate your debts. However, working with a credit counseling agency or a debt relief lawyer to improve your credit management and financial skills can be a great way to start getting out of debt. The lawyer or counseling agency could even work to negotiate lower payments, interest rates, or balances to help you reduce your debts before repaying them.

The catch here is that if you do file for bankruptcy, credit counseling and debt education are essential steps in the process, so you’ll already be ahead of the game. For most people, of course, reaching out and getting credit counseling first can prevent things from even reaching that point.

Credit counseling can assist with:

• Reducing payments and interest rates
• Stopping collection calls and fees
• Educating you on better financial management
• Help you learn budgeting and debt management skills
• And more

 

Alternative #4 – Super Budgeting

This goes well beyond a basic budget. This is a major lifestyle change. You should immediately stop excess spending and sit down and assess your spending habits. Start practicing the frugal lifestyle and don’t even think about trying to live beyond your means. Spend less on day-to-day living so that you can spend more paying down your debts.

Creating a budget isn’t as daunting as it sounds. You simply have to figure out:

• How much money is coming in
• How much money is going out
• How to make sure your income exceeds expenses (more in than out)

This could mean cutting the streaming services you hardly ever use. It could mean reducing your spending on extras or luxuries or even being more frugal at the grocery store. In the bigger picture, consider revisiting your housing and vehicles, and other larger expenses that you may be able to reduce.

Being able to live more cheaply can also provide its own fulfillment and stress relief. The cost of living is unpredictable, but a good budget and smart financial sense can keep you living well, even on a shoestring budget. Then, you can use all the extra money you’re not spending to pay down those debts.

 

Alternative #5 – Sell Assets (If You Have Them)

One of the best alternatives that can help you reduce your debts and pay off some of them is to sell any assets that you have. Have a garage sale. Sell that high-end SUV and get a reliable, budget-friendly car without payments. We live in a world so filled with stuff that we often don’t realize how much we don’t need until we start looking around.

When you’re selling things, don’t sell them emotionally. Otherwise, you’re going to be offended by what people are willing to pay. Do your homework and figure out what you should expect to earn for certain items, including high-value collectibles as much as that basic Tupperware set you’ve barely used.

As a note, you’ll likely end up selling assets anyway if you file for Chapter 7 bankruptcy, so it’s not a bad idea to get it done sooner and take advantage of how it can help you before you reach that point.

 

A Few Other Options in Athens…

These are the top ways to handle debt without going to the trouble of filing bankruptcy. Of course, there are also other potential ways that you can help yourself out of debt without the “big B”.

1. Borrow from Family or Friends: This can be a tricky route because it’s paved with the potential to ruin relationships, but if you’re smart about it, it can work. Treat it just like a bank loan, set payment terms, and make sure that you have a financial plan when you go to them to show that you’re serious about your commitment here.
2. Earn More Money: The gig economy makes it easy for anyone to pick up extra work these days. You can find a lot of ways to earn money from home, from your car, or even from the office when you’re not busy tending to your daily responsibilities (just make sure you clear it with your boss first).
3. Refinance the Mortgage: If you have a mortgage, restructuring or refinancing could help you come up with extra money to repay other debts and improve your financial situation. If you’re in serious financial distress already, however, you may not qualify for this type of lending.

As you can see, whether you go with the classics or get creative, there are plenty of stop-off points on the road to bankruptcy that can help you avoid it altogether.

 

How to Decide What’s Right for You in Athens

Feel free to do more research on the alternatives above and see what other suggestions people have. However, make sure that you choose a solution that is best for your situation, no matter what that might be. For example, one person might be able to borrow money from a family member to help repay debts, while another person might be entirely on their own and have no choice but some kind of debt settlement or bankruptcy filing.

Why not just ask the experts? A bankruptcy and debt relief lawyer in Athens, GA can help you figure out how to proceed with your debt resolution. They will review your situation, listen to your needs and concerns, and help you decide which course of action is best. At Morgan & Morgan, our lawyers have years of expertise in financial law and we can help you with everything that you need.

If bankruptcy ends up being the best choice, we’ve got a track record that’s sure to impress. And for other debt relief, we’ve got services to help with that, too. Whatever you need, we’re here to help you get your financial life back on track once and for all. Contact Morgan & Morgan to discuss your needs for debt relief today.

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