Debt problems can make you feel as if you are drowning in the sea. Every time you believe you can get your head above water, another wave crashes on top of you. It can be difficult to know who to trust to help you with your debt problems.
Our Mesa debt problems attorneys work with individuals and couples who need relief from overwhelming debt. We analyze your financial situation to determine your debt relief options. Our lawyers clearly explain those options so that you can choose the debt solution that is best for you.
Filing a Chapter 7 or Chapter 13 Bankruptcy to Get Out of Debt
For many people, bankruptcy is an affordable solution to their debt problems. Through a Chapter 7 or Chapter 13 bankruptcy case, they eliminate the debts they cannot afford to pay. They also protect their future wages and their property from creditors.
Some indicators that you may need to file a bankruptcy case include:
- You have no money left over each month to pay debts after paying your living expenses;
- You are facing a foreclosure or repossession;
Your wages are being garnished; - You owe tax debts or back alimony and child support that you cannot pay;
- You have been unemployed for several months with no job prospects;
- You have high credit card debt or medical debts; or,
You are considering using your home equity or retirement savings to pay debts.
Before you make a decision or take any further steps, talk to a Mesa bankruptcy lawyer about a bankruptcy filing. You may find that bankruptcy is the solution you need for your debt problems.
Non-Bankruptcy Options for Solving Debt Problems
If bankruptcy is not right for you, there are other debt-relief options that you may want to consider. However, some of these options have downsides. Before taking action, it is a good idea to ask for a free consultation with a Mesa debt problems attorney. An attorney can review all the pros and cons of various debt relief options to ensure that you understand the options fully before choosing a debt relief option.
Debt Settlement
Debt settlement involves negotiating a lump sum payment with a creditor to satisfy the entire debt. The lump-sum equals a percent of what you owe to the creditor. Some things to keep in mind about debt settlement:
- You need cash on hand to pay the lump sum payments;
- Creditors do not need to work with you;
- The amount you pay may be higher than what you would pay through a Chapter 13 plan;
- The amount forgiven is treated as income, which can increase your tax liability; and,
- It is a lot of work to negotiate with each of your creditors.
Debt Consolidation
Debt consolidation can be handled in two ways. You can apply for a debt consolidation loan to combine your debts into one monthly payment. In some cases, you can lower your interest rate on some of the debts and reduce the total monthly payment.
However, most companies require collateral for a debt consolidation loan. Therefore, you are risking your home, car, or other property when you consolidate debt. If you cannot make the payment, you lose the property. If you are on the brink of foreclosure, a Mesa foreclosure attorney can help navigate you through that process as well.
You could also work with a debt consolidation company. The company negotiates with your creditors to lower your payments and other terms of the loan to make the payments affordable. You pay the debt consolidation company each month and it pays the creditors.
As with debt settlement, your creditors are not required to work with you. They could accept payments for a while and then file a debt collection lawsuit. You also must pay a fee to the debt consolidation company each month, which could be high. In most cases, the amount you repay to your creditors is much higher than the debt you owe today.
Contact Our Mesa Debt Problems Attorneys for Help
Debt relief options can be confusing. Talk to an attorney before you decide how to resolve your debt problem.
Contact 602 Law Group by calling 602-562-5000 to schedule your free consultation with a Mesa bankruptcy lawyer.