Bankruptcy law gives struggling borrowers the opportunity to reclaim their lives from crushing debt, but it should be a last resort. While many consumer debts are eliminated in bankruptcy, you may also lose some of your valuable assets and be forced to spend years rebuilding your credit. Fortunately, there are ways to regain control of your finances without liquidating your assets.

3 Ways to Avoid Bankruptcy

1. Seek Credit Counseling

Interest-free credit card offers and store charge accounts make it easy to spend more than you earn, which can be overwhelming for borrowers without strong financial management skills. Credit counseling services give you the tools to plan a monthly budget, develop a long-term plan, and pay down your debts without seeking bankruptcy protection.

2. Negotiate a Settlement

If you don’t have the funds to meet your financial obligations, settling the debt for a lower amount can relieve the pressure on your budget. Creditors are often willing to accept a reduced payment rather than receive nothing at all, but you must have the cash on hand to pay the settlement all at once. These negotiations can be complex and frustrating, so you may need to hire an attorney to protect your interests.

3. Take Out a Debt Consolidation Loan

Debt consolidation loans allow borrowers to combine all of their debts into one monthly payment, which may be lower than the combined cost of paying several bills every month. The loan term may also be shorter, getting you out of debt as soon as possible. However, make sure that the interest rate of the loan is actually lower, or you could wind up paying more in the long run.

Is unmanageable debt taking over your life? The legal team at Pirrello, Personte & Feder, PLLC, Attorney at Law in Rochester, NY, has the resources and expertise to provide the second chance you deserve. Their bankruptcy lawyers have over 120 years of combined experience delivering high-quality legal advice to families throughout Monroe County and the surrounding counties. Visit their website for more on their debt relief services or call (585) 544-7090 to schedule your initial consultation.