4 Alternatives for Bankruptcy in Ottawa

Being out of control in your debt is a financial whirlpool as it sucks more and more of your money into a swirling vortex. People stuck in this whirlpool can feel powerless as they see their bills grow larger every month, and interest payments take away their pay. The people caught in this consider bankruptcy, and they may seek help from a bankruptcy trustee in Ottawa. Bankruptcy may be an option, but there are alternatives that you can reconsider. 

Known alternatives for bankruptcy

Debt Settlement

You can sometimes strike an agreement with creditors to pay less of what you owe by choosing a debt settlement company, or you can do it yourself. With debt settlement, it involves debt forgiveness. The creditor or a debt collector must accept a partial payment for settling the full balance. If the creditors agree to write down what you owe them, then the unpaid balance is considered income and must be reported on your tax return. Seek a settlement of debts that you stopped paying but continue making minimum monthly payments on those that you can afford. This will stop harassing calls from collection agencies and help you steer clear of the bankruptcy court. If you decide to do it yourself, contacting creditors, and explaining your financial bind, you can also save money. 

Debt Consolidation

Debt consolidation is an approach that you’ll need access to a credit line or a loan that allows you to pay off your current debts. It could be from a personal loan from a bank or credit union or a home-equity credit line that allows you to borrow against your house. With a consolidated payment, you can save on interest and avoid the headache of paying bills each month. You could transfer the debt to that card and use the grace period to pay down the principal if you qualify for a credit card that offers to temporarily lower your interest rate on balances. You can also use a debt counselling agency like Doyle Salewski Inc. that consolidates your debts through a debt management program. 

Sell Assets

If your income is not enough to make payments, consider selling assets. The more valuable your asset, the more cash you can make for your debt payments. Once you have valuable assets, you might be able to reduce debts enough not to file bankruptcy. You can direct the money you realize through asset sales to an account you can settle debts. Of course, you need to come up with a strategy first. You need to keep the assets that are essential to operating the business. 

Credit Counseling

If negotiating doesn’t work on your creditors, consider credit counseling. Credit counselors can often help you in developing a debt management plan with payments that you can afford. They can work with your creditors to lower your payments and interest rates. Even if you decide to file a bankruptcy, the law may require you to consult a credit counselor first. 

Before you give up and file for bankruptcy, consider these options first. You may find one that suits you, and you can start up with a clean financial slate. Click here to know more about bankruptcy solutions.