Denver Debt Settlement Attorneys Wink & Wink Can Help Clients Obtain Debt Relief
A home is likely one of your biggest expenses, if not the biggest.
Your house can be a place that provides joy and comfort, or it can become a nightmare if you’re struggling to make monthly mortgage payments on top of paying down other unsecured debts.
If your total debt has become too overwhelming, you’re probably wondering what your options are. Is foreclosure bound to happen any day now? What can you do to avoid foreclosure and face your debt head on if you don’t have a huge pile of cash?
Luckily, there are several options to consider. But first – before doing anything else – it’s recommended you consult a debt settlement lawyer, such as Wink & Wink of Denver, Colorado. We can review your financial situation and help you understand the right choice for you, which may include these tactics.
Make Payments Only On Your Secured Debts
Creditors – the people or organizations to whom you owe money – want to see you at least make some payments toward your debt, even if it’s not the required monthly amount. This shows you’re at least trying.
If you can, at least make some payments each month to show the creditor you’re still making the effort rather than paying nothing. Plus, you’re at least slowly chipping away at your debt.
For unsecured debts – not your car or home loan, for example – stop payments and start saving the money you’d normally put toward them. A debt settlement attorney may be able to negotiate a settlement for a discount from the total balance owed, cutting your debt in half if you can promise to make a lump-sum payment. The money you’ve saved by not paying these bills must be enough for this payment.
Sell Assets You Don’t Have to Have
If you’re in need of debt relief, you simply may have to sell some assets to free up some money. Do you have multiple vehicles and could get by with just one? Could you get by without a vehicle at all?
Examine your possessions, and determine which you could get rid of and get some money in return to put toward your debt. It may not be much, but every cent counts, especially if you’re preparing to make a lump-sum payment.
Ask About Refinancing or Modifying Your Home Loan
While your credit score is still decent, it may be smart to refinance your mortgage to lower your monthly payment. Refinancing can also extend the loan term, giving you more time to pay off the loan.
After speaking with a debt settlement attorney for their advice, ask your mortgage lender about your options. If you cannot refinance, you may be able to agree to a loan modification, in which the terms of your home loan are adjusted without starting anew. The resulting modification can sometimes lower the interest you owe.
Work Out a Forbearance Agreement
For secured debts, it may help to talk to your creditor and explain your situation – again, after you speak with a debt settlement lawyer at Wink and Wink. They may have sympathy and grant you a forbearance agreement, where they allow you to make lower monthly payments or none at all for a period of time.
This can allow you to save up money toward paying back the loan later – but remember that interest will still accrue. When your financial situation improves, you can continue paying down the loan.
Rent Out a Room of Your House
Do you have an extra bedroom you don’t use? Perhaps you could rent it out to someone who could make monthly rent payments that you can then use toward your mortgage and other monthly bills.
For many people, the idea of a stranger moving into their house is not a happy one! But it may be a way to earn some money and stay in your house rather than losing it through foreclosure as you pay down the rest of your unsecured debt. And it doesn’t have to be a stranger – maybe a friend, family member, or co-worker is looking for a room.
Even a temporary arrangement can help you earn additional income to use toward debt settlement.
Consider Filing for Bankruptcy
If your debt is becoming too much, it may be time to consider filing for bankruptcy.
As with other debt solutions, it’s crucial you speak with a Denver bankruptcy lawyer, such as Wink & Wink. We’ve been helping clients get much-needed debt relief since 2009.
It’s important to note that bankruptcy won’t keep you in your home if you’re unable to pay the mortgage. But it can give you some time to catch up on all the back payments you owe, as the bank won’t be able to foreclose while you’re going through bankruptcy. Plus, bankruptcy can remove your liability for other debts so that that money can then be used toward paying off your mortgage.
Chapter 13 bankruptcy – where some of your debt is eliminated (for example, medical debt, credit card debt, etc.), you have to make payments in a Chapter 13 plan for 3 to 5 years. Chapter 13 can help you avoid foreclosure by putting the arrears into the chapter 13 payment plan while you resume making regular mortgage payments..
Chapter 7 bankruptcy – where some debts are eliminated (for example, medical debt, credit card debt, etc.), there is no payment plan. This means Chapter 7 is typically less helpful at allowing you to catch up on your mortgage. However, it buys you a few months of protection from foreclosure and eliminates other debt, which may be what you need to catch up on your loan payments.
When trying to determine whether a Chapter 13 or Chapter 7 bankruptcy makes the most sense, it’s essential you consult with a trusted Denver bankruptcy lawyer.
Speak With a Debt Settlement Attorney Today
If you want to take your debt head on and avoid foreclosure, speak with a debt settlement attorney today. If you wait too long, your home may be foreclosed before you can stop it. Call Wink & Wink at (303) 410-1720 or contact us online to get started.