7 Tips For Dealing With Debt Before Bankruptcy


So you have a little bit of debt. You're human. You have a lot of debt? So do thousands of others in your exact same financial situation. Your real concern should be not your debt itself but the actions you will take to eliminate or reduce it while avoiding more.

Many individuals are turning towards bankruptcy but the bankruptcy process can take time - especially as you save money for a retainer and work to fill out the piles of paperwork. During that time your creditors will expect to continue receiving payments. So what can you do to avoid problems with your creditors as you work towards your ultimate goals?

Maryland Bankruptcy Lawyer, Tucson Bankruptcy Lawyer, Bankruptcy Attorney Pittsburgh, Demand Debt Verification A debt that has been sold to another company is different from one that has been passed to a collection agency. You do, however, have the right to demand documentation proving you owe a debt. If your debt has been sold to another company they may have trouble proving you owe them money. Your bankruptcy lawyer will work with you to make sure your filing process moves as quickly as possible. In the meantime, your bankruptcy attorney will work with you to minimize harassing phone calls from creditors. Keep Your Personal Information Personal Never, under any circumstances, give a debt collector your bank account information or any other type of personal information they can use to access your accounts. If they don't have it already, don't give them your employer name or phone number either (they'll just start calling you there, too). Document Creditor Information Document every phone call you receive from or make to a debt collector or creditor. Write the name of the agency, the name of the caller, and the address of the agency. Federal law mandates you can send a letter to a third party agency requesting they stop calling. Avoid Unrealistic Payment Plans A creditor may offer you a low payment plan. It may sound like a great idea at the time but consider your overall situation - not just one creditor. Can you make arrangements with all of your creditors and avoid bankruptcy? If not, don't make arrangements with any. Avoid Third Party Collections Procedures vary from company to company but if your account goes more than 90 or 120 days past due you can almost guarantee it will be written off and sent to a third party collector. Many of these agencies are very difficult to deal with and are sometimes even threatening. While it's important to treat them with respect it is also important for you to understand that the collection agency is not your creditor and you do not have any obligation to speak with a caller from that agency. If the caller is aggressive or threatening you have the right to end the call. Acknowledge Your Debt Believe it or not, trying to avoid creditor phone calls is more stressful than answering the phone and telling them you're having financial troubles. Pretending your debt does not exist will not help your situation at all and your creditors will be more willing to work with you if you are open and honest about your situation. Call Your Creditors Call your creditors and let them know you are having financial difficulties. If you are comfortable with your decision you may even mention that you are filing for bankruptcy. Even if you don't have a petition number yet your creditors may put a short hold on the harassing phone calls while you get your affairs in order.


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