Being in debt can feel like drowning. Many people who find themselves in debt become so overwhelmed that they simply give up and lose everything that they own. While this is understandable, this is not the right course of action to take to resolve your debts. You need to be proactive when you find yourself in debt so that you can resolve your situation and get out of debt again.
A Baltimore debt reorganization lawyer can help you see the light at the end of the tunnel. There are options that are open to you to satisfy your debts and work toward a debt-free future. Having expert assistance can make a big difference as you navigate the process of getting out of debt. Don’t hesitate to seek legal assistance if you are in over your head.
Things to Explore if You Are in Debt
First of all, you need to know that you have access to a few specific paths of resolution under federal law. These paths have different pros and cons, and your lawyer will help you to understand which of them is likely the best course of action for your situation.
1. Filing for Chapter 7
Chapter 7 filing, or bankruptcy filing, is often the easiest course of action if your debts are significant. This is also called “liquidation” and it costs a small fee for filing. After the fee has been paid, the process will take about 3-4 months to be completed. If your new income falls below the poverty line, your fees might be waived entirely, or you might be allowed to pay them in installments.
Bankruptcy filing allows you to “reorganize”, which means that you will be able to keep most of the property that you own while you repay your debts over a set time period, usually 3-5 years. This is usually the best bet for those who own their own home, so that they don’t have to give up their home to pay off their debts.
Bankruptcies will show up on your records even after they are completed, but over time, the reorganization will impact your credit score less and less.
2. Credit Counseling
One of the recommended steps that you should take if you are in significant debt, is seeking credit counseling. The credit use system is complex, and people often don’t understand it properly, leading to bankruptcies and long-term struggles with money. When you know how the credit system works, you can use it properly in the future.
Credit counseling is a user-friendly experience, and some credit counseling services can even negotiate with your creditors on your behalf. Being able to write off some of your debt in favor of repayment for a portion of it can help you to get out of debt fast.
3. Debt Consolidation
This is one of the best options if your debt comes from things like student loans. You can have a lawyer or a debt counselor help you to apply for consolidation of various debts, thereby reducing the interest that you are paying and helping you negotiate for a payment that you can afford each month. When you have many lines of credit or many installment loans open at the same time, you can struggle to keep up. In most cases, consolidation over a longer loan period can be the answer to resolving your debt properly.
This is one of the options that many people don’t know are open to them, and they instead just struggle to stay afloat until they have to file for bankruptcy. Make sure that you check out your options with regard to consolidation before you decide to declare Chapter 7. Debt consolidation might not even show up on your credit report as a blemish if your debts are easy to consolidate.
When Do I Need a Lawyer?
Lots of people are not sure when they need to secure legal support for their debt situation. The answer to this question can be complex, but in most cases, if you are unable to keep up with any of your payments and you are at risk of losing your home, it is more than time to seek the advice of a lawyer. Your lawyer will work hard on your behalf to file necessary documentation and to seek a consolidation or repayment plan that makes sense for your current situation.
Having someone who understands the law surrounding debts can make it much easier to seek a favorable process for resolving your financial situation. Lawyers often understand how to consolidate payments effectively as well, making it much more likely that you will be offered a reasonable repayment plan if you are looking into the process of consolidation.
Make sure that you look for a lawyer who handles bankruptcy and debt cases full-time. There are so many legal ins and outs to these cases that a lawyer without specific experience might not be able to help you consolidate or repay your debts as efficiently as a lawyer with years of experience handling these cases.
Debts Don’t Need to Ruin Your Life
While it can be devastating to be in debt and not be sure how to make ends meet, you don’t have to go down with a sinking ship. You have the ability to control your debt problem. With the help of an experienced lawyer, you can get your debts under control and get to work paying them off. Don’t wait until it’s too late to save your personal property. Seek the help of a lawyer as soon as you can tell that you won’t be able to keep up with your debts anymore.
Getting out of debt fast requires that you negotiate, and a lawyer can help you to handle the negotiation process with ease. Handling your financial issues can feel overwhelming but once you have a lawyer on your side, you should be able to see the forest through the trees for the first time.
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