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Over 845,000 people filed bankruptcy in the U.S. in 2015, according to statistics gathered by the U.S. Bankruptcy Court. While bankruptcy can be a useful tool to stop a home foreclosure, put an end to creditor harassment and get rid of overwhelming debt, it can also temporarily impact your credit rating and make it difficult to borrow money for the near future.

The truth is that bankruptcy is just one solution among many. A skilled bankruptcy lawyer can advise you on whether your situation merits filing bankruptcy or looking into alternatives to bankruptcy like the following.

Negotiating with creditors

You may be able to negotiate your outstanding debts with your creditors directly. Depending on the amount of your debt, a creditor may be willing to negotiate a lower amount or terms more favorable to you. The downside to this approach is that the creditor may demand full payment or refuse to accept the terms you propose.

Credit counseling

Some people choose to work with a credit counseling service when attempting to negotiate with creditors. Such a service can often negotiate a better plan than you could obtain on your own. However, buyer beware. Some incentive-based credit counseling services charge excessive fees or simply negotiate the payment of the interest on your debt, not the actual principal. This means you will keep accruing interests since the actual balance of your debt isn’t decreasing.

Payment plans

A payment plan provides you with a way to manage your outstanding debts and avoid a prolonged bankruptcy proceeding. Payment plans should reflect what you can realistically pay on a periodic basis (e.g., weekly, monthly, quarterly, etc.). You should also make sure that any interest rate associated with a payment plan is reasonable and not predatory in nature, which will result in you paying more in interest than what was associated with the original debt.

Debt consolidation

Debt consolidation is another option that you may want to consider. This involves taking out a loan to pay off your old debts, often at a lower interest rate. You still have a debt that will need to be repaid and could be the source of problem in the future if you are unable to pay the loan off, so tread carefully.

Get sound advice on your options

The best way to move forward is to learn more about your options and seek advice from a professional who understands your situation. A good bankruptcy attorney will counsel you to take the action that seems best for your situation – whether that involves filing bankruptcy or taking advantage of one of these alternatives.