Are you finding yourself falling behind in your monthly credit card bills? Are you struggling to learn how to deal with debt collectors or how to consolidate credit card debt? Well, welcome to the club. Unfortunately, far too many Americans find themselves buried in excessive credit card debt, as well as other kinds of debt. Many times this is a result of uncontrolled spending and lack of discipline, but there are other cases which are difficult to prevent such as medical emergencies not covered by insurance.
Americans are quite open up on how they want to spent or squander with their savings as they feel that it is their right to manage their funds the way they please but just because agencies like the International Debt Collection start hounding them to repay debts, they realize the seriousness of non-repayment of loans due to which they have no choice but to declare themselves as bankrupt but then again, insurance and medical emergencies have to be looked into.
In any case, if you find yourself unable to deal adequately with your current debt, you need to consider all of your options carefully together with a financial adviser and attorney. If your financial situation is so severe that you can’t afford either of these, you should at least read and learn as much as possible with articles like these and other resources. These should help you decide what the best course of action is in your specific circumstances, and you’ll learn things like how to declare yourself bankrupt as well as alternatives to bankruptcy.
If it looks like bankruptcy will be the best option for you, you’ll need to speak to a lawyer and get some good advice. For example, if you can’t see yourself paying off your bills within a few years even if you make some sacrifices in your budget, you need to look at bankruptcy as a serious option.
Getting a lawyer may sound like a significant expense, and it can be, but it is also a necessary one. The bankruptcy code can be pretty complex for a layperson to understand, and has only gotten got more difficult with the recent changes made by Congress. The good news is that if you are successful in wiping out your debts, this will make it more feasible for you to pay for legal fees in the future.
Also, as soon as you file a bankruptcy application, you receive what is called an automatic stay. This prevents your creditors from contacting you at all until your bankruptcy is resolved. This gives you some breathing room for you to get through the process. The new bankruptcy law requires that you take financial management classes, and it also has a more rigorous requirement when it comes to documenting your income and expenses.
Basically, you have to prove that you really can’t pay your bills with your current income. If your income is lower than the median income for your state, the process will be much easier for you because it’s obvious that you don’t have a lot of money.
You should also keep in mind that some kind of debts will not be eliminated by bankruptcy, and this includes (in most cases) federal income taxes and student loans. There are many more details that you should work out with your lawyer, but this should give you a basic understanding of the process.