Bankruptcy Alternative. In amending the Bankruptcy Code in 2005, Congress declared that bankruptcy should be the last resort for struggling consumers. For most people who are struggling with debt, they want to avoid bankruptcy and, more importantly, they want to pay back what they can—they just need help understanding their options to do this. The key is to learn your options.
Financial Workouts. For years, corporations that have faced unsustainable debt burdens have engaged in “financial workouts” with their creditors. In recent years, consumers have begun adopting similar tactics in resolving their unsustainable debts with unsecured creditors. How? By entering a structured debt resolution savings program that accumulates savings that can be utilized to negotiate settlements with the various creditors.
Bankruptcy. Financial Workout programs are not for everyone. In some instances, a consumer may be better off with a fresh start by filing bankruptcy, if they qualify. In other instances, if a consumer’s financial workout program doesn’t work out, the consumer may choose to file bankruptcy as a last resort to resolving their debt problems.