If you have a gap between your income and your spending, you have to rely on borrowing to make ends meet. This is not sustainable and it will quickly lead to a spiral of debt that is incredibly difficult to get out of. Debt takes over your life and you will soon find that you are nervous every time the phone rings or a letter comes through the door, and you can’t sleep at night because you are constantly worried about your debts. If things get really bad and there is no way that you can pay back your debts, you may be considering bankruptcy. But even though bankruptcy gives you the chance to start again, it leaves a lasting mark on your credit report and it can make things difficult for you in the future. The good news is, there are some great alternatives that you can try before you declare bankruptcy. 

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Debt Discharge Programs 

In some cases, understanding the laws and knowing what constitutes liability for a debt can help you to clear your debts overnight. You may be able to find a way out of debt without having to pay any of it back if you change your legal status so you are no longer liable. Debt discharge programs, like the Debt to Success System are designed to help you do just that. They will use their knowledge of the law to help you clear your debts overnight, and if you join as a member, you will get education on these legal issues so you are not forced into debt in the future. If you want long term freedom from debt, a debt discharge program is one of the best options. 

Debt Consolidation Loans 

Debt consolidation loans are a great option if you have a lot of high interest debts. Many people find themselves in a position where they are only able to pay the minimum payments, and that means that they are mainly paying interest and the actual debt itself doesn’t reduce that much, so they are trapped. With a debt consolidation loan, all of your loans will be paid off and then you will have one single payment each month. This saves you money on interest and having one single payment to make helps you to manage your budget more effectively. 

Rethinking Your Budget

You may think that you are unable to meet your financial obligations each month, but have you actually considered your budget to see whether you can make cutbacks? Often, people think that they need to declare bankruptcy because there is no way that they can pay their debts, but that isn’t the case. If you are strict with your budget and you put all of your spare money towards debt payments, you may be able to pay your debts gradually over time. This is a much better choice because it won’t have a negative impact on your credit score as long as you keep up with payments. When your debts are cleared, you can work on rebuilding your credit score and building some savings. 

Bankruptcy has a lasting effect on your financial health, so before you rush into it, make sure that you consider these alternatives.