Managing debt after the holidays – what are your options?
Many people experience financial difficulties following the holiday period. Even with a set budget for gifts, food and other expenses, it’s easy to overspend in the moment and put off worrying until later.
If you’ve started the New Year with a financial hangover from the holidays, the worry may already have set in. You may have racked up a large amount of credit card debt, leaving you unable to cover the essentials such as mortgage payments or medical expenses. However, there are options available that can help you get out of debt and regain control over your financial future.
Around this time every year, a slew of adverts appear offering the chance to consolidate your debts. These ads target people who have racked up a large amount of debt through credit cards or unsecured loans, promising an immediate improvement to your finances. However, debt consolidation does not provide legal protection against creditors, nor does it prevent them from pursuing your debt through foreclosure, repossessions or other approaches.
Similarly, taking on more debt to pay off existing debt is an unwise decision. Paying off credit card balances with other credit cards or taking out a personal loan to cover mortgage payments only compounds the issue.
While many people think that bankruptcy is something to be avoided at all costs, in many cases it may be the best solution. Bankruptcy does not necessarily mean losing your home or your possessions; there are different types of bankruptcy that offer different protections for your assets and property. While the process can be complex, an experienced bankruptcy attorney can help you to understand whether bankruptcy is the right choice for your specific situation and provide guidance at every step.
If bankruptcy is not the right choice for you, it may be possible to negotiate with your creditors to make repaying your debts easier. Reduced interest rates, extended payment plans and debt forgiveness are all potentially negotiable, especially with effective legal representation.
Many people under pressure from creditors feel that there is no way out of their financial situation, but solutions do exist. Consulting with a dedicated bankruptcy and debt negotiation lawyer can help in finding the right option for you.