Are you finding it difficult to pay off your debts? If your finances aren’t strong at all, then it is not so easy to get rid of debt. Though most people do not want to file bankruptcy, this seems to be the only option when they fall behind in making the debt payments. Make a resolution to yourself this New Year that you won’t incur debts anymore. If you can really do this, then you can avoid filing bankruptcy in the New Year.
Some ways how you can avoid bankruptcy in the New Year
Bankruptcy seem to be the last option when you think you won’t be able to eliminate your debts. Have a look at some ways how you can avoid filing bankruptcy.
- Negotiate your outstanding debt – Chapter 7 bankruptcy is the liquidation of your debt. However, it may mean relinquishing your assets. If you’re thinking to file for Chapter 7 bankruptcy, then you may be able to keep your property and repay your creditors by settling the outstanding debts. You may choose consolidation and merge all your debts into a single payment every month. Settlement is also a good option that will enable you to settle your debts with ease.
- Sell off your own property – If you decide to file for Chapter 7 bankruptcy, then your property is going to be assessed by the trustee. It is the trustee who takes the decision as what to liquidate or sell in order to settle your claim. You may avoid this by selling off some assets before you may decide to file for bankruptcy.
- Modify your mortgage loan – You may modify the terms and conditions of the loan in order to make the payments within your means. If you can arrange for a new payment plan for your mortgage, then you may be able to pay off the loan and at the same time, save money. You should try to avoid filing bankruptcy so that your home may not get foreclosed.
- Take money from friends – You may ask your friend or cousin to lend you some money for paying off the debts. However, you will have to be very careful since borrowing money from them may create distance between the relationship if you fail to pay them back on time. Draft a budget and see how much money you need for avoiding bankruptcy.
- Try to make some sacrifices – You may re-evaluate your budget and see where you are spending money unnecessarily. Try to differentiate between your necessities and wants. If you go for shopping very frequently, try to skip them for the time-being. Learn to live within your means from the New Year and save every dollar you can. You will be able to eliminate your debts with ease.
If you think you will not be able to manage debts on your own, you may seek advice of a counselor. He will help you get back your finances on the right track this New Year and pay off your debts with ease.