With the unemployment rate at 8.5 percent, many Americans are wondering what they should do if they suffer a job loss and can no longer pay their debts. Well, what you SHOULD NOT do is ignore your creditors. I repeat, do not ignore your creditors, instead, send them a letter explaining to them that you are currently unemployed and that you are unable to repay your debt at this time. There are several options available to the unemployed who are having trouble paying debts or even daily bills; but each option is different for each type of bill.
- Mortgage Debt - Sometimes lenders are willing to modify your mortgage, offer a forbearance or some other type of deal. Whatever agreement you come to, get it in writing and have a professional review the agreement BEFORE you sign.
- Credit Card Debt - Credit card lenders are most often difficult creditors to negotiate with. Some credit card companies may be willing to offer a forbearance or reduced payment for a temporary amount of time; but this is highly unlikely unless there are extraordinary circumstances.
- Student Loans - Educational lenders have the most flexible plans available for those facing a job loss. Unemployed workers can receive a forbearance or reduced payments. Beware, interest continues to accrue during forbearance.
If you have contacted your creditors and have been unable to negotiate affordable terms during your unemployment, you may want to consider bankruptcy. If you fail to repay your creditors, even if you are unemployed, they will eventually file a lawsuit against you and win a judgment. Being unemployed is not a defense for failing to pay your debts. But using bankruptcy, you may be able to discharge or create an affordable repayment plan for your debts. Filing Bankruptcy may help you discharge all types of debts including, credit card debt, payday loans, utility bills, medical debts and even some tax debt. Contact a Dallas-Fort Worth bankruptcy attorney today to discover your bankruptcy options.