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ALTERNATIVES TO BANKRUPTCY - Manchester, New Hampshire
Before filing Bankruptcy in Manchester, New Hampshire you want to make sure that you have explored all possible options available to address your overwhelming debt situation. Bankruptcy is not always the only option. In fact, there are a few options to consider. In the end, you have to make the decision that is truly best for you and your specific financial situation. Some law firms may want to do whatever they can to ensure you use their services to file for Bankruptcy.At FAMILYLEGAL we take our client responsibilities very seriously. We sincerely want to help you make the right choice for your financial situation, even if that means that you do not choose Bankruptcy. It is important that you do what you think is best for you, your finances and your future. Go ahead, Contact Us or call (603) 225-1114.
The particular alternatives to Bankruptcy that you can consider, as well as how these will affect you, will vary on a case by case basis. However, the alternatives to filing Bankruptcy are typically limited to: debt consolidation and debt settlement.
DEBT CONSOLIDATION
Debt consolidation is a broad term that could be getting one larger loan to pay off all creditors. However, this requires that you financially qualify for such a loan. This can be difficult given the current tight lending requirements. And, obtaining such a loan may require that you secure it by a mortgage on your home. This could place your home in considerable jeopardy depending upon your ability to meet your payment obligations.Debt consolidation can also involve hiring a debt consolidation company to negotiate a reduced monthly payment schedule with your creditors thereby allowing you to possibly pay off your debt over time. However, there are many factors to take into consideration when reviewing this option. These factors are:
- Many debt consolidation companies are out-of-state fly-by-night companies that operate with little regulations and are simply focused on getting your money not really assisting you in resolving your debt problems. They are predators that prey upon your desire to cooperatively resolve your debt situation. They tell you that they can help you, but in the end they do nothing but take your money too.
- Most debt consolidation companies charge upwards of $3,000.00, $4,000.00, even $5,000.00 to work with your creditors to establish reduced monthly payments. This cost can simply add to your already overwhelming debt issue because they typically do not provide services until their fee is paid in full.
- Debt consolidation is not always a viable option as many creditors refuse to take part in such a program that would reduce their monthly revenues. As a result, you will have to pay the debt consolidation company a hefty amount each month to pay some credits that are willing to accept reduced amount. And, you will need to pay the creditors that are unwilling to participate in the debt consolidation program as well. This typically is impossible.
- While you are in a debt consolidation program you are unable to obtain any other credit. No credit cards. No car or other loans - nothing. These debt consolidation programs typically last years. This means that your credit options and your ability to improve your credit are stagnant for years.
- Debt consolidation is typically not an option if your debt is in excess of Thirty percent (30%) of your yearly income. This is because once you pass this point you simply do not have the necessary funds on a monthly basis to effectively participate in such a debt consolidation plan.
DEBT SETTLEMENT
The other option to consider is debt settlement. Debt settlement typically involves hiring a debt settlement company to negotiate a reduced lump sum payment with your creditors thereby allowing you to possibly pay off your debt in a reduced lump sum payment. However, there are many factors to take into consideration when reviewing this option. These factors are:- Many debt consolidation settlement are out-of-state fly-by-night companies that operate with little regulations and are simply focused on getting your money not really assisting you in resolving your debt problems. They are predators that prey upon your desire to cooperatively resolve your debt situation. They tell you that they can help you, but in the end they do nothing but take your money too.
- Most debt settlement companies charge upwards of $3,000.00, $4,000.00, even $5,000.00 to work with your creditors to establish reduced lump sum payment. This cost can simply add to your already overwhelming debt issue because they typically do not provide services until their fee is paid in full.
- Debt settlement is not always a viable option as many creditors refuse to take part in such a program that would reduce the total amount they would receive over time. As a result, you will have to pay the debt settlement company a hefty amount each month to pay towards some credits that are willing to accept a reduced lump sum amount. And, you will need to pay the creditors that are unwilling to participate in the debt settlement program as well. This typically is impossible.
- Debt settlement requires that you come up with consolidation lump sum amounts to pay creditors. For example, if you owed a creditor $7,000.00, they may be willing to accept $3,500.00 in a lump sum settlement payment. However, this would require you to come up with a payment of $3,500.00 immediately. This is typically financially impossible.
- When ever a creditor writes off†more than $600.00 in a debt settlement program, they are required to issue a IRS Form 1099 to you for the debt that was written off. This means if you owed a creditor $7,000.00, and they are willing to accept $3,500.00 in a lump sum settlement, you will receive an IRS Form 1099 from the creditor for $3,500.00 the amount written off. This means you may have to take that $3,500.00 as income and you will owe taxes on same. This can run into significant hidden costs and possible IRS debt issues. This is never a good situation.
CONSIDER YOUR OPTIONS CAREFULLY
Of course, it is important to be careful when considering your debt resolution options. There are many debt resolution predators that will promise you whatever you want to hear to get you to pay them. And, in the end you may find that you still have overwhelming debt, your credit is now damaged, you are out $3,000.00 to $5,000.00 for nothing, you are being sued by your creditors, and/or you now have a debt issue with the IRS. Clearly, this is not what you want. And, that is why it all comes down to working with a partner that you can trust.FAMILYLEGAL is the largest consumer Bankruptcy provider in New Hampshire and New England because, in part, we earn the trust of everyone we meet with. We will NOT put anyone in a Bankruptcy if that is not the best possible option for their specific financial situation. If Bankruptcy is not the right option for you, we will match you with reputable debt consolidation and debt settlement companies that will do their best to resolve your financial crisis. As most of our clients come from personal word-of-mouth recommendations, it is vital to our continued success for us to earn your confidence whether you ultimately use our New Hampshire Bankruptcy service or not. FAMILYLEGAL will be your trusted partner in resolving your debt crisis and moving you forward towards future success.
As you can see, FAMILYLEGAL may be able to help you with your current financial situation. There really is no reason not to take advantage of our FREE initial bankruptcy consultation. Go ahead, Contact Us or call (603) 225-1114.
If you decide to file for Bankruptcy in the Manchester, New Hampshire area, our experienced Bankruptcy Attorneys prepare all of the paperwork and explain the documents to you. They walk you through every step of the process. Go ahead, Contact Us or call (603) 225-1114.
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