Phoenix Bankruptcy Law News

February 2013 Archives

Debt Relief: Top 3 Alternatives to Filing for Bankruptcy

When you’re swimming in bills, it can seem like there’s no way to get debt relief. But there are alternatives to bankruptcy, even if your situation seems hopeless.

The benefit of filing for bankruptcy is that the process is well-established. There are specific papers to fill out and sign, certain procedures to follow in court, it’s easier to predict.

If you opt for alternative debt relief, you may have to blaze your own trail.

But the benefit is that you don’t have to deal with the downsides of bankruptcy, which are also mandated. So we have some suggestions of routes you can take that might help you deal with your debt without ruining your credit score.

Is It Time to File for Bankruptcy?

The idea of filing for bankruptcy is intimidating and, unfortunately, the process is designed that way. Lawmakers don't want to make walking away from debt the easy option.

After all, everyone has some amount of debt. If we could all easily shed that every time it accumulates, it would seriously damage how credit works. But sometimes debt gets out of hand, which is what bankruptcy is for.

But when is there enough debt to file for bankruptcy? That depends on the kind of debt you have and how much you've accumulated.

Should Your Business File for Chapter 11?

When small businesses go into bankruptcy, the assumption is that the company is going belly up. It's gone to the Small Business Association in the sky, never to be heard from again. But that's not the way the story has to end.

For businesses that have hit a financial snag but want to keep going, there is Chapter 11. This type of bankruptcy gives you the option to claw your way out of debt.

It's not an easy process, but if you want your business to soldier on, Chapter 11 may give you that opportunity. You just have to decide if it's right for you.

Save Yourself From Harassing Debt Collectors

When you're deep in debt, every phone call sounds like a debt collector calling to ask you about overdue bills and late payments. But when they start harassing you with calls, that's when you can put your foot down.

Companies have the right to collect the debts you owe, but they have to be fair about it. That means there are limits on what they can do to get the money from you.

Of course, knowing what those are is easier said than done. No debt collector is going to explain the Fair Debt Collection Practices Act to you. But here are some of the things they can't do, no matter how deep in debt you are: