Debt is not an uncommon thing. In fact, according to a study by Pew, 8 in 10 Americans have debt. Debt takes on several forms, such as mortgages, credit cards, car loans, student loans, etc. Debt on its own is not necessarily a bad thing, however when borrowing becomes excessive when compared to the household income available, that is when trouble begins. Bankruptcy is a potential path when the financial obligations become too much. There are options before considering bankruptcy that can help individuals attempt to help reduce the debt obligations.

What Can I Do?

If part of the debt obligation is a mortgage, homeowners can start with calling the lending institution and having a discussion with a loan officer to see if there are options available. Each individual’s situation is unique and depending on yours, the lending institution may be able to work with you. Some entities will offer short term solutions such as forbearance, where the mortgage servicer/lender allows you to temporarily pause paying your mortgage or may lower the payments for a specified time period. A loan modification is another potential option. This is an agreement between you and your mortgage company to change the original terms of your mortgage to help reduce the monthly payment to a more affordable amount. This is just one option to evaluate before considering bankruptcy.

Itemize all your assets, debt and monthly bills. Are there reoccurring charges that could be considered frivolous if you’re in financial hot water? Do you need cable, Neflix or Hulu? Can you reduce your cell phone plan? What other expenditures are there in a monthly time frame that can be trimmed down? Are there assets that could possibly be sold? TVs, jewelry, furniture? If you’re a two car family, can you survive on one car and eliminate the 2nd car payment if both have loans?

Talk with your creditors and see if agreements can be worked out. Discuss what you’re going through with family or close friends. This is not an uncommon problem. And they may be able to help.

Schedule a Call or Visit

The Kepple Law Group offer a free, 30 minute consultation as well. Call or fill out the form below and we will help you evaluate your situation and find the best path forward for you. Financial hardship is nothing to be embarrassed about. Talk to us today to start taking control back and removing some of the stress and fear of debt.