Bankruptcy Alternatives

If you are struggling with debt, you have many options available to you outside of bankruptcy. Learn more about your alternatives here.

Consolidation

One way to ward off bankruptcy is to lower your interest rates to reasonable levels so paying off your debt is more financially plausible. Getting debt consolidation quotes can help you do just that. Your service will lower your interest rates to affordable levels, and more of your monthly payments will go toward principal instead of interest. This enables you to get out of debt faster without wasting thousands on interest expenses.

Credit Counseling

Credit counseling is another good alternative to bankruptcy and can even be used in conjunction with debt consolidation. After you get a quote on debt consolidation, you might look for credit counseling agencies in your area. Most credit counseling services are available for little to no cost. These agencies can help you organize your budget, map out a repayment plan, and change your spending behaviors. Some states even require that you pursue credit counseling prior to declaring bankruptcy.

Prioritize Your Debts

If your debts are getting overwhelming, you may have more success with paying them down if you reprioritize them by interest rate. You should be devoting the bulk of your payments to your highest-interest card, and, once that is paid off, you can move onto other cards with lower interest. While you're paying down high-interest debt, just make the minimum payments on your other cards. If you decide to get a debt consolidation quote, you do not have to worry about this, as all of your interest rates will be substantially reduced.

Get a Home Equity Loan

For homeowners who have too much unsecured debt, there is always the option of a home equity loan. You might pursue this instead of debt consolidation quotes if you have enough equity in your home to borrow against for consolidation purposes. You can take the difference between your mortgage balance and your home's value to pay off your credit cards and then make payments on a lower-interest loan. You might even be able to deduct the interest from a home equity debt consolidation loan on your income taxes.