BANKRUPTCY UPDATES

• Taking Your Credit Score from Bankrupt to Perfect 10 (May 21, 2012)
• Music Storage Website MP3Tunes.com Seeks Bankruptcy Protection (May 22, 2012)
• Book Publisher Houghton Mifflin Harcourt Files for Bankruptcy (May 17, 2012)
• Las Vegas Tycoon Lists $500 Million in Debts in Bankruptcy Filing (May 15, 2012)
• Nassau Broadcasting Sells its Assets in Bankruptcy Court (May 22, 2012)

Debt Reducer

Everyone has a favorite debt reducer. From stashing money under the mattress to limiting their spending on entertainment, there are a number of remedies for reducing your debt.

Many Americans, however, are currently faced with debt loads that cannot be reduced by simple methods. Many of these consumers have found that personal bankruptcy offers a reliable, efficient method of debt reduction.

To see if bankruptcy is a suitable fit for your unique financial circumstances, fill out the form below and connect with a bankruptcy attorney in your area today.

Bankruptcy as a Debt Reducer

Personal bankruptcy offers two common avenues through which a consumer can attempt to reduce their debts. The first form of bankruptcy is Chapter 7, which allows consumers to discharge some or all of their unsecured debts. Such debts include:

• Credit card bills
• Medical bills
• Utility bills
• Payday loans
• Some personal loans
• Store cards

By filing for Chapter 7 bankruptcy, a debtor also receives the benefit of the automatic stay, which prevents creditors from seeking payment during bankruptcy proceedings. In addition, Chapter 7 filers receive debt counseling as part of the bankruptcy process.

Alternatively, the second type of debt reducer, Chapter 13 bankruptcy, offers consumers a chance to repay their debts at a more reasonable pace.

Through Chapter 13 bankruptcy, you may be able to:

• Save your home from foreclosure
• Keep other valuable property during the bankruptcy process
• Have some unsecured debts discharged after bankruptcy

In addition, Chapter 13 filers also receive the benefit of the automatic stay. People who file for Chapter 13 bankruptcy usually have steady incomes that allow them to make monthly payments on their restructured debt plans.

Other Debt Reducing Tips

While you go through the bankruptcy process, and before and after you file, there are several steps you can take to further reduce your debt. Listed below are some helpful debt reducers:

• Stop charging all your purchases on credit cards. By paying for more things with cash or debit cards, you'll reduce the chances of paying interest on your purchases.
• Create a budget each month and stick to it. Sometimes making a budget and tracking your spending also reveals surprising truths about your spending habits.
• Use lists for shopping trips. You'll be amazed how much you save by sticking to a set list.
• Set up an emergency fund. With emergency cash on hand, you'll be able to make debt payments even when times are tough.

Of course, these strategies often only claw away at the margins of debt, or are helpful for those with only a small amount of debt. Personal bankruptcy may be beneficial if you are looking to eliminate unmanageable debt for good.

To learn more about bankruptcy as a debt reducer, contact a local bankruptcy lawyer today. Just use the free case review form on this page to get started.