Finding an Alternative to Bankruptcy

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When to File Bankruptcy – The Last Resort
Bankruptcy is an option for your personal finances or your business finances but this is a last resort option. There are thousands of people who have chosen bankruptcy over a bankruptcy alternative simple because they lacked information about their options.

Here is how you can tell if no bankruptcy alternative is right for you:
1. If you have personal debts that are well beyond what you can pay. Clearly you should examine alternative options like refinance loans, debt consolidation loans, and other debt solution services. If you get smart professional advice that there is no alternative, then bankruptcy is probably the right option for you.
2. If your business is not generating the revenue to support its bills and you have too much overhead and too many debts, bankruptcy may be an option for you. You business doesn't even have to close since bankruptcy will shield the business until it can get up and running financially again.
3. If you need to use bankruptcy, then by all means use the option – but don't be afraid of taking the time to explore and learn about bankruptcy alternatives.

Out-of-Court Settlements as a Bankruptcy Alternative

An out of court settlement is often a better option than filing for bankruptcy. You may have begun the bankruptcy process and have been referred to arbitration or out of court negotiations or the opportunity may present itself to you, but these negotiations can yield results that make everyone happy.

Out of court negotiations are tough to deal with on your own. It is recommended that you hire an independent company to help you negotiate with your creditors. Make sure you hire a reputable company or counselor. Ask for references and make sure that they have no consumer complaints filed with the Better Business Bureau or any other consumer advocacy agencies.

If your out-of-court settlement is conducted improperly, it can hurt your credit. The right help is out there, with the right bankruptcy alternative, it's up to you to find it.
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Filing Bankruptcy with the Help of an Attorney

If you must declare bankruptcy, then make sure you hire a reputable bankruptcy attorney. Bankruptcy attorneys are specially educated about the laws of the state in which they practice and they have the experience to make sure you file correctly. You will pay a fee for a good bankruptcy attorney, but the up front cost is well worth the long term results.

To ensure that you end up with a good attorney, get a referral from your local or regional bar association. They will only refer you to attorneys in good standing. Many bankruptcy lawyers will also see you for a free consultation before they take your case. They will let you know if you are a good candidate or not and whether they can take you on as a client.

Make sure you feel comfortable with the attorney you choose and make sure you understand the fees associated with the bankruptcy and when and what you need to pay. Again, filing for bankruptcy is really a last resort, but if you must file, make sure you hire a professional to help you through the process.
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Debt Consolidation as a Personal Bankruptcy Alternative

If you have too much debt, or too many debts, debt consolidation may be a better alternative than bankruptcy for you. If your credit is still in good shape, you can get a great interest rate and you can consolidate all of those creditors.

Here is how a debt consolidation loan can help you get in control of your finances and avoid bankruptcy:

If your problem has been making monthly payments on time, a debt consolidation loan can be a great personal bankruptcy alternative - it will simplify your bill paying. Rather than eight credit card or loan payments, you'll be making one which is far more manageable. Rather than worrying about payments of different amounts, you'll have a fixed payment. If you want to learn how to manage money, start small.

In many instances, one of you existing creditors can help you with a debt consolidation loan. Remember, they have a large stake in your avoiding bankruptcy. They want their money back and they may very well be willing to lend you more to pay off credit cards and the like.

Consult with a lending expert to assess whether debt consolidation is the right bankruptcy alternative for you.
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Finding an Alternative to Filing Bankruptcy

Filing for bankruptcy seems like an easy way to eliminate debt but it can cost you far more money in the long term. Because the long term damage of bankruptcy is very serious you need to find as many potential bankruptcy alternatives as possible. How do you start?

1. Why are you considering filing for bankruptcy? Do you have a mountain of debt and creditors beating down your door? You do have options including speaking with a debt or credit counselor about getting your finances and your spending back under control. Control and better spending habits are the keys to avoiding bankruptcy, so start now.
2. Look online! If you found this tip, there is more information out there online or in your local bookstore. There are thousands of lawyers, service providers and counselors who will take the time to help you find a bankruptcy alternative.
3. Get a professional to help you traverse the rapid waters of financial instability. They will help you calculate the short term and long term effects of a bankruptcy or an alternative.

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3 Questions to Answer When Choosing a Bankruptcy Alternative

How do you decide if bankruptcy is right for you? Here are some tips on what you should think about before you file for bankruptcy:

1. Have you spoken to a financial advisor or credit counselor? Seek information *before* making your decision to file for bankruptcy. Speak with a professional and make sure you really need to file before you do. They may have a better bankruptcy alternative for you.
2. What are the long term consequences? Bankruptcy can destroy your credit and linger for up to seven years.
3. Have you considered all of your options, really? So many people today are so desperate to get out of their financial troubles that they will take the first option thrown at them. That may be bankruptcy or a bankruptcy alternative. Being desperate can lead you down a path of bad decision making. Review all of your options and speak with different professionals for alternate opinions. Taking your time to make the right decision is better than making a quick bad one and living with the consequences.

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The Information You Will Need to File Bankruptcy

How do you decide if bankruptcy is right for you? Here are some tips on what you should think about before you file for bankruptcy.

1. Have you spoken to a financial advisor or credit counselor? Seek information *before* making your decision to file for bankruptcy. Speak with a professional and make sure you really need to file before you do. They may have a better bankruptcy alternative for you.
2. What are the long term consequences? Bankruptcy can destroy your credit and linger for up to seven years.
3. Have you considered all of your options, really? So many people today are so desperate to get out of their financial troubles that they will take the first option thrown at them. That may be bankruptcy or a bankruptcy alternative. Being desperate can lead you down a path of bad decision making. Review all of your options and speak with different professionals for alternate opinions. Taking your time to make the right decision is better than making a quick bad one and living with the consequences.

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Steps to Filing Bankruptcy in Florida

Filing bankruptcy is different from state to state but there are some basic steps that typically must be followed everywhere. Here is a sample bankruptcy process:

1. Gathering Paperwork – You'll need a listing of all of your income and assets. This includes all income, and big financial transactions and any property or assets you have. You also need to gather all of your living expenses (typically one month's worth) and all of your debts. You'll need supporting documentation like tax returns and the like to support your stated income.
2. Filing Bankruptcy – Your property may or may not be exempt from your bankruptcy petition, but once all of the documentation is prepared, you will usually fill our several forms. In many cases, it's easier to pay the money for an attorney at this point. They can ensure that you complete the documentation properly and that you haven't missed any reported debt or assets.
3. Automatic Stay – In some states, after filing your petition for bankruptcy, something called an automatic stay will take effect. This stops any foreclosure proceedings, creditors from calling you directly and any activity in terms of loan repayment.
4. Assignment of a Bankruptcy Trustee – A trustee will be assigned to your bankruptcy as once you file your petition, the court assumes legal control of your debts and property. The trustee will review the paperwork you submitted and they may challenge any aspect of your petition if it seems incorrect or improper.
5. Meeting of Creditors – About one month after filing for bankruptcy, the trustee will call a meeting of your creditors, which you will have to attend. If any of the creditors object, there will be a negotiation between the filer or their attorney and the creditor. The judge will render a decision on any matters that are not decided by negotiation.

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Using Credit Counseling to Find a Personal Bankruptcy Alternative

If you're looking for credible bankruptcy alternatives, the best place to start is with a consumer credit counselor or consumer credit counseling service. These services offer credit counseling free of charge and accompanying services. They can include budget counseling, educational programs about credit and money management, housing counseling and debt management assistance.

It is very important that you make sure your credit counseling service provider is reputable. Check with your Better Business Bureau or consider Consumer Alerts – whatever you do, don't trust anyone with your private information unless they are reputable. Just because they are at the top of Google, doesn't mean they are the best company to go with. By seeking help you will learn about the alternatives that you have and you'll learn what you need to do to avoid getting into this situation again.
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Liquidation as an Alternative to Filing Bankruptcy

If you are in over your head with debt or creditors, you may want to consider liquidating some assets in order to get cash and pay off your debts. Obviously, there are some things that you can't part with, but if you have two cars when you really only need one, or if you have extra "stuff" around that has significant value, why not sell it and pay off some debt. One of the most important financial concepts to grasp in money management is that stuff is just that, stuff. Brand name purses, jeans, travel, fancy cars are all just things that don't mean much anyway. And those things, if they are furthering your financial progress are just hindrances to your future anyway. Start by prioritizing your assets. Are you living in a condo that is too expensive for you? Are you driving a new car when you could buy used? Before you walk down the road of bankruptcy, consider liquidating as an option. You probably didn't need all that stuff anyway.

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