There is just no easy way to get out of debt; you have to face up to the consequences. A bankruptcy is not always the answer,
as the effects are long lasting. There are four ways to handle debts that are out of control, listed in best to worst in regards
to the effect it will have on your credit:
If your credit isn't in terrible shape, you might reduce your other expenses, even if it means making hard choices or just
change your lifestyle to fit your income? Some ways to do this:
Selling the second car and Pulling equity out of your
home or maybe applying for a non-secured signature loan ask for a loan from a relative.
Selling your home and paying off
your debts with the proceeds and then renting or finance a less costly home Cashing out your 401K/retirement benefits as a
down payment on another home will allow you to use your home equity for retirement.
Selling family heirlooms/jewelry/guns online is a great way to raise money fast.
If your credit is already gone or one of the above isn't an option, go through Consumer Credit Counseling Services (CCCS).
Check your yellow pages for the local number. In this way you're paying off your debts as if you were in a Chapter 13 BK,
but you don't file a BK.
If CCCS won't take you, you may want to consider bankruptcy. Doing a Ch 13 takes longer, but your credit is in a little
better standing than if you do a Ch 7. In the Ch 13 they give you up to 5 years to pay off your debts. The disadvantage is
that you're in BK for up to 5 years plus your credit report shows your BK for 7 more years after you have finished paying
off your debts.
If you are so far in debt that you can never repay it, then the best solution may be a Chapter 7 BK. A Ch 7 is the least
desirable credit-wise, but you are typically out of BK in 6 months and you don't have to repay any debt. The disadvantage
is that this shows on your credit report for 10 years from the date of filing your BK, and creditors are starting to tighten
their credit requirements, and you may have a tough time getting future financing.