Alternatives to Bankruptcy
Look for what works best for you
Although bankruptcy is often a solution to debt problems, it is not necessarily the best solution for everyone.
Bankruptcy Attorney Christopher Hittel has helped hundreds of people who were in need of advice and consultation when faced with an overload of debt. His free consultation offers his legal as well as his practical advice.
“I find many times that a client’s problem can be efficiently solved by means of a practical solution instead of applying a legal solution.”
Attorney Christopher Hittel
His goal is to guide and inform, ultimately to help you find what is best for you. Many times it takes a combination of both practical and legal solutions. For example, to qualify for a modification most lenders are requiring a full financial disclosure. Many lenders require that all income be verified by pay stubs and deposits into a bank account.
Before a modification can be considered by a lender, they usually require financial documentation. Sometimes a client is unable to track his or her spending and even if certain debts are settled or protections are applied, the client’s spending exceeds the take-home pay. These people can become easy prey to predatory lenders who offer credit as a solution. And as time goes by, a $100 deficit per month becomes a much larger debt over time as it is many times compounded with loan-sharking* rates.
*In Florida loan-sharking is defined as interest rates over 25%, with some exceptions as well as Federal exceptions for national banks who are based in states with higher legal interest rates.
We are faced with a constant pressure to purchase beyond our capacity. As a result many people are faced with debt they cannot reasonably pay. Recognizing the past is an important step, but finding a reasonable path for the future is the real focus for finding a more favorable outcome. I have found that the clients who gain the biggest benefit are those who apply practical solutions as well as legal solutions to their present situation.
Attorney Hittel on Working One on One with Clients:
I work one on one with my clients to establish a working budget. My custom Excel spreadsheet automatically converts weekly, every other week, twice a week, quarterly and yearly income into monthly figures. Most people know what their monthly bills are: mortgage/rent, electric, water, cable, phones, car payments, gas, medical, credit cards, charities, and other payments. We decide on a buffer percentage for the unexpected and hopefully savings.
After the monthly expenses are subtracted from the monthly take-home, the remainder is for food, house supplies, clothing and entertainment. We then compare this amount to the national average for your size family. If there is nothing left or not enough to feed your family or yourself, we then have to review the monthly expenses to determine which ones need to be eliminated and how best that may be accomplished.
Next we create a separate cash account for food, clothing and entertainment. We are faced daily with temptations to buy fast food, to buy packaged foods, expensive clothes and entertainment. You can only spend what is in the cash account for these items. If your food, clothing and entertainment is managed directly out of the same account as your other monthly expenses, it is nearly impossible to keep track, so there is nothing to tell you that you cannot afford something until the mortgage or that car payment or the electric bill is due.
The practical solution for many debt related problems is not to spend so much. I work with my clients to set up a solution that is reasonable and easy to track. Once the accounting is simplified, then families find it easier to save for vacations, Christmas, birthdays and other fun stuff.
Gaining control of your money is part of gaining control of your life.
If you have debt, the best and most simple legal/practical solution is to pay on time. If you are unable to do that, see if you can settle the debts*. If you are unable to settle your debts; seek legal advice as to your protections under the law.
*Knowing your protections under the law will help you know when a settlement is a good settlement or a settlement will not work out for you in the long run.
If I am being garnished
If you are already being garnished and cannot or do not want to file bankruptcy, you may file a Declaration and Claim of Exemption (DCE) and a Motion to Stay the Garnishment. If successful, you might be protected from the garnishment at hand; however the underlying judgment and the threat of future garnishments will remain. Most non-governmental garnishments require a judgment and a subsequent court order.
The purpose of claiming exemptions against the garnishment is to allow the debtor a chance to continue with their life, a chance to continuing working and contributing to society and caring for their families. Beyond the exemptions claimed and allowed by law, the courts likely will consider that the judgment creditors are entitled to their garnishments.