Debt problems are stressful and frightening. Financial trouble can cause health issues, emotional distress, and marriage problems. If you cannot pay your debts, the battle with debt problems may be the entire focus of your life at the moment. However, there is hope. There are ways to get rid of debt. Some debt relief options might be better than other options, depending on your financial situation.
Our Chandler debt problems attorneys work with you to find a solution that is best for you. We are here to help you get through this difficult period so that you can look forward to a better and stronger financial future.
Exploring Debt Relief Options
There are several debt relief options you may want to consider.
If you are struggling to pay multiple debts each month, consolidating those debts into one monthly payment may help.
Debt consolidation loans can lower your monthly debt payment and your interest rate on that debt. However, there may be some drawbacks to debt consolidation.
Debt consolidation loans usually require collateral. Therefore, if you use your home, vehicle, or other property to secure the debt, you are turning unsecured debts into secured debts. If you don’t pay your credit card bills, the creditors cannot foreclose on your home. However, if you don’t pay the payments for an equity line you used to consolidate debts, you could lose your home.
If you work with a debt consolidation company, you may pay high monthly fees for their service. Also, creditors may not be willing to lower payments, reduce interest rates, or extend the terms of the loan agreement. Therefore, you could still face debt-collection lawsuits and other aggressive forms of debt collection from some of your creditors.
Negotiating with your creditors to accept a lump sum payment to cancel the debt may sound appealing. Instead of paying the full balance owed on the account, you can get rid of the debt for a percentage of what you owe.
However, some of your creditors may not be willing to negotiate the debt. Also, you need access to enough money to pay the lump sum payments quickly. If you borrow against your home or use retirement funds, you could be wasting money on debts that might be dischargeable in bankruptcy.
Filing a Chapter 7 or Chapter 13 bankruptcy case may be the best way to get rid of debts. Through a bankruptcy filing, you can discharge most, if not all, unsecured debts. Unsecured debts that are dischargeable in bankruptcy include credit card bills, medical debts, personal loans, deficiency judgments, and some old income tax debts. A
Chandler bankruptcy lawyer can review your financial situation to determine what debts you can discharge in bankruptcy.
Furthermore, by filing a bankruptcy case, you can protect your property and your retirement funds from being used to repay debts. Bankruptcy exemptions protect a certain amount of equity in various items you own. The amounts vary, so it is always a good idea to meet with a bankruptcy lawyer in Chandler to review your case before making any decisions about filing for bankruptcy relief.
Ignoring Your Debts
Ignoring your debts is NOT advisable. If you do not take steps to resolve the debt problem, your creditors may sue you to obtain personal judgments. After obtaining the judgments, creditors may seek court approval for wage garnishments. Losing any part of your income could be devastating financially. Talk to a Chandler debt problems attorney now to find an affordable way to get out of debt.