Alternatives to Bankruptcy
Is bankruptcy the right choice?
At Kostopoulos Bankruptcy Law, many of our clients are naturally curious about their alternatives to bankruptcy when they initially approach us. If you are struggling with unsustainable debt, you have some difficult choices in front of you. While bankruptcy may be a viable remedy, there are always alternatives to filing bankruptcy and it’s important to weigh all of your options so you can make an education decision about your financial future.
We have included several basic strategies for getting your debt back under control. Since no two debtors’ situations are identical, what may work for one debtor may not work for another.
Reduce Your Overall Expenditures
If you have high credit card balances but can still pay your monthly minimums, are you able to reduce your other expenses while paying your debt off? Perhaps by making some subtle changes in your lifestyle habits, you can carve away a good chunk off your credit card debt.
- Do you need to buy lunch every day?
- Do you need cable TV, or that $4.00 cup of coffee several times a week?
- Eliminate extravagant expenses and consider alternatives such as bringing lunch to work, clipping coupons for groceries and buying clothing and merchandise on clearance.
- Instead of paying for a babysitter, consider exchanging babysitting with a friend.
- Can you live without a second or third car? If so, sell it.
- Develop a realistic budget and stick to it.
Negotiate With Your Creditors
If you have some disposable income or have assets you’re willing to sell to pay off creditors, you may want to consider negotiating with Kostopoulos Bankruptcy Law creditors directly. This can be a time-consuming process which will involve speaking with customer service representatives, writing letters and getting things in writing but in the end you may get one or more creditors to agree to settle on a debt for less than you owe. However, keep in mind that in order to get a creditor to agree to accept a settlement, you will need the cash in your pocket to make such an arrangement, and always be sure to get everything in writing.
File for Bankruptcy
If you’re already living within your means and have nowhere else to cut back on expenses and your credit has already taken a big hit from having too many late payments, or if you don’t have access to funds to negotiate with creditors, then bankruptcy may be your only and best option.
There are two main consumer bankruptcies, the Chapter 7 bankruptcy and the Chapter 13. In order to file a Chapter 7 you would have to qualify based on income/expenses and assets. If your income is too high, you will be diverted to filing the Chapter 13, which allows a debtor to pay off a portion of their debts within a 3 to 5 time period and at a monthly payment they can reasonably afford.
If you want to know if bankruptcy is right for you, contact Kostopoulos Bankruptcy Law at (877) 969-7482!
- Our San Francisco bankruptcy attorneys have represented over 6,000 clients in their bankruptcy cases.
- Our lead attorney, Rita Kostopoulos is a certified bankruptcy specialist.
- We have been named as one of the Top 100 Firms by the Debt Education and Certification Foundation (DECAF).
- We can explain life after bankruptcy and how rebuilding your credit can be realistically achieved.
Looking for a qualified bankruptcy lawyer in San Francisco? Read what our clients have to say about us in our client testimonials!