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Running away from bankruptcy may not be helpful

People in Washington who are struggling to keep up with even the minimum payment on their smallest monthly bills have likely already been subjected to a barrage of advice about what they "should" do. Pay that debt off first, increase principal payments, find a job that pays more -- but are any of these really that doable? For some, maybe, but the vast majority of debtors likely cannot benefit from this type of advice. Unfortunately, many people who actually need the financial security that bankruptcy can provide may still try these options, thus putting off filing and worsening their financial state.

Credit counseling that helps debtors consolidate costly credit card bills down into a single, manageable monthly payment is often advertised as a better and more efficient alternative to bankruptcy filings. In reality, approximately half of these types of counseling agencies fail to actually help a debtor get his or her debt down to zero. Even those who are set on a manageable payment plan typically end up paying much more than they even owed in the first place. 

Instead of spending upwards of five or six years chipping away at a mountain of uncontrollable debt, consider looking to the future. The past is the past, and there is no changing the unforeseen circumstances that might have thrust an individual past the tipping point of financial stability, but there is hope for the future. For many people drowning under medical bills, credit card statements and other unsecured debts, bankruptcy can be the breath of fresh air that sets them back on the path toward financially secure life.

When faced with taking long-term losses of hundreds of thousands of dollars by consolidating debt versus discharging debts through a Chapter 7 bankruptcy, the choice may already be clear. Making debt go from an unimaginable amount down to zero should not be the only goal of debt relief. Accomplishing this in a timely and sensible manner is paramount to handling debt in the most appropriate way possible. For many people in Washington, the sooner debt is handled, the sooner they can start to reshape their financial future.

Source: The Huffington Post, "Why a Chapter 7 Bankruptcy Should Be Your First Option and Not a Last Resort", Steve Rhode, May 7, 2015

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