Are debt payments stressing you out? You are far from alone. According to a report from CNBC, nearly three-quarters of Americans rank their finances as the number one stress in their life. If you are falling behind on your debt payments, you may be looking for a path forward. Bankruptcy offers a potential solution to eliminate debt and get a fresh start.
That being said, bankruptcy is not the best option in every circumstance. In fact, it is generally a best practice to consider all available non-bankruptcy debt-relief alternatives before filing for Chapter 7 bankruptcy protection or Chapter 13 bankruptcy protection. In this article, you will find an overview of the debt-relief alternatives to filing for bankruptcy in Nevada.
Four Alternatives to Filing for Bankruptcy in Nevada
1. Adjust Your Lifestyle—Make Changes to Your Personal Finances
A significant percentage of the people who are dealing with financial troubles do not actually know how much they owe. This is understandable—debt is complicated and it can be difficult to handle your finances all alone. At the same time, it is crucial that you have a clear financial picture. Only with full information can you create a plan. For some people, lifestyle adjustments—increasing income, selling certain property/assets, and reducing expenses—could be the most effective alternative to filing for bankruptcy.
2. Consolidate Your Debt (Roll Multiple Obligations Into a Single Payment)
In some circumstances, debt consolidation can serve as an alternative to filing for bankruptcy protection. With debt consolidation, you may be eligible to roll multiple debts into a single monthly payment. Depending on your circumstances, the monthly payment could actually be lower than your current collective debt payments. The interest rate may be lower and you may even be eligible for extended repayment terms.
3. Work With Creditors & Debt Collectors to Negotiate a Repayment Plan
Another key alternative to filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy is negotiating a settlement with your creditors/debt collectors. You should not file for bankruptcy protection without at least trying to settle your debt for less. In some cases, a Las Vegas debt relief lawyer can help you negotiate an agreement to settle your outstanding debt for significantly less than you owe. Debt collectors are more willing to offer settlement terms when you can present a well-supported case that demonstrates your inability to pay.
4. Do Nothing and Default on the Debt (Usually a Big Mistake)
Finally, it is worth noting that another alternative to filing for bankruptcy protection is “doing nothing.” In effect, this means that you will likely default on one or (more likely) several debts. This is almost invariably a serious mistake. It could result in your facing civil lawsuits from debt collectors and even a wage garnishment, bank levy, or asset seizure. Further, it will damage your credit. As explained by Equifax, most adverse information stays on your credit report for seven years—meaning every month you miss a payment is at least seven years of poor credit information.
A Debt Relief Lawyer Will Help You Find the Best Path to Financial Stability
Before filing for bankruptcy protection, it is crucial that you have a full understanding of your financial situation—including all of the alternative options that might provide a viable path back to financial stability. A debt relief attorney can help you determine if bankruptcy is the right option for you and your family. Ultimately, there are four main ways to dig out of debt and get back to stable financial ground:
- Increase your earnings;
- Decrease your expenses;
- Reduce monthly costs (lower interest rates and/or extended time to repay); and
- Elimination (forgiveness) of debt.
For many people and families who are dealing with financial distress in Las Vegas, the path out of debt involves some combination of the above. Ultimately, the right option for you will depend entirely on the circumstances of your situation, including the specific amount that you owe and your current ability to make payments. With guidance from an experienced legal professional, you can fix your debt problems and get a true fresh start.
Call Our Las Vegas, NV Bankruptcy Attorney Today
At Vohwinkel Law, our Las Vegas bankruptcy & debt relief attorney helps clients stop creditor harassment and eliminate overly burdensome debt. If you have any questions or concerns about the alternatives to filing for bankruptcy, we are here to help. Give us a call now or use our online contact form for a free, completely confidential case evaluation. From our Las Vegas law office, we help people get out of debt in Clark County and throughout Nevada.