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Is Bankruptcy the Only Option to Your Financial Troubles?

March 24, 2015 by lucas in Finances

Sadly, more people than ever are finding themselves in difficult situations when it comes to their finances. More and more people are looking at filing for bankruptcy in light of their financial troubles. But, there are alternatives. Bankruptcy is not the only solution that is available to you. In the face of money problems, it can feel as though there is little reprieve. It may feel that there is no way out. This is not the case. There are some other alternatives that you should investigate before you commit to bankruptcy.

For many individuals, they are often faced with the age old dilemma of debt consolidation vs. bankruptcy. There are pros and cons of each of these solutions. It’s important to make the right decision for you. Let’s take a look at these solutions and see which is best for your circumstances.

Bankruptcy: It’s Not the Only Option

Bankruptcy. Even the mere mention of the word is enough to send people into a shiver. It’s not a decision that is taken lightly. Usually, if you want to declare yourself bankrupt, you will have to apply for a court order. This means that all of your assets will be liquidated and as such, you will no longer have these asserts at your disposal. As a result of this, you will be allowed to have a ‘fresh start’ in regards to your finances, but you will not be able to obtain credit. What’s more, your home may be repossessed.

Before you file for bankruptcy, it’s always best to investigate all other options.

Exploring the Debt Consolidation Route

Debt consolidation can be a positive method to organise your finances in a more robust way. You can access a specialist credit company that offers these loans as a solution. Often, these are an attractive prospect for those that are indebted. This is because you only have to deal with one creditor, one rate of interest and one payment date. Often, your debts are consolidated so that you can stretch the term time of the agreement. This can give people greater flexibility when it comes to matters of debt. It’s important that you don’t take on any additional debt during this time. Willpower is imperative during this period. If you want an easy way to pay back your loans and you don’t want your credit record impaired in any way, this can be an excellent solution.

 

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Researching Your Other Options

For many, they are keen to take the helm of their finances. While consolidation loans can be massively beneficial, it may not be worth taking on this kind of loan if you only have a short credit term left in place. As such, it may be wise to get to the crux of the problem and why you overspend. That way, you can be more proactive when handling your finances. It could be worth looking into credit counselling and debt charities. These can be a valuable asset when you are trying to live a life that is debt free. Ensure that you seek these companies out and get the right information on budgeting and living without credit. Using these services in conjunction with a debt consolidation loan can ensure that you are making the right steps to a financially healthy life.

Debt doesn’t define you. Now is the time to take action for your spending habits. What route will you take?