California Bankruptcy Lawyers - Alternatives to Bankruptcy
Filing for a California Bankruptcy is often seen as a last resort – the last step to try after all other attempts at remaining financially afloat have failed. For the majority of individuals, there are a few alternatives that can be tried before filing for bankruptcy, but only if there is an adequate income for repayment of debt. Additionally, the majority of bankruptcy alternatives are only effective if there have not been a significant number of missed payments. Individuals who are several months behind on payments across the board may find it difficult or impossible to keep up a realistic repayment schedule.
If you are considering alternatives to bankruptcy and believe that you have a viable means to repay or work out your debt obligations with your creditors, there are two main methods to achieving this goal. The first is to work directly with your lender or creditor to come up with payment arrangements which work for both you and your creditor. When negotiating with your creditors in this way, you must first plan out a realistic budget so that you know how much you can afford to pay, and how often. Don’t let your creditors talk you into paying more than you can reasonably afford, otherwise you will fall behind again and renegotiations with creditors are often difficult, if not impossible.
Another alternative, if you don’t wish to work with your creditors directly, is to work with a credit counseling service or debt management service. These outside agencies work with you to establish a budget and will negotiate on your behalf with regards to the payment arrangements. You should be prepared to pay a modest fee for the service, but be wary of any company that attempts to charge a large upfront fee for credit counseling or debt management – it may be a scam.
For most people contemplating California bankruptcy, these two options are less than ideal. And bankruptcy can offer additional benefits that alternatives cannot provide. For instance, in a Chapter 13 bankruptcy filing, the bankruptcy judge can alter the terms of loans, including reducing what you owe and the payments as well. If you file for Chapter 7 bankruptcy, you can effectively eliminate most unsecured debt. Either option can make it easier for you to recover financially in a shorter period of time than with other methods.
If you are considering filing for bankruptcy but aren’t certain about whether or not the benefits of bankruptcy outweigh other factors, please contact our office. We can provide you with a free, no-obligation case evaluation that will give you objective information about the benefits of bankruptcy compared to the alternatives. Speak with one of our experienced, reliable California Bankruptcy Attorneys today and get the information you need to make an informed choice.