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Review of alternatives to the bankruptcy process

At our law office, we believe that our clients deserve the opportunity to explore all options for resolving their debt should they run into financial trouble. While we do not hesitate to recommend bankruptcy to a southeastern Tennessee resident when that really is their best financial option, we also will not hesitate to let families know when they should consider trying another approach.

After all, while bankruptcy can give a family the fresh financial start they desperately need, it comes with some sacrifices. For one, a person's credit score is always going to take a hit after that person files for bankruptcy, making it harder for that person to get loans and other financial advantages in the short term.

Moreover, in many cases, a person who files for Chapter 7 winds up having to turn over some of their property to the bankruptcy trustee and, in all cases, a person who files a Chapter 13 is going to have to pay something toward their debts. Moreover, not every debt can be discharged in a bankruptcy.

Our office, therefore, can represent a debtor if they are in a situation where bankruptcy might not make the most sense but the debtor is still struggling to shake off an old bill. In some cases, we are able to help our clients work things out informally, especially when our clients have been good, faithful paying customers of the creditor in the past or when, as is often the case, the only alternative to working things out is a bankruptcy, which is ideal for neither the creditor nor the debtor.

We would also be remiss not to mention several businesses that offer to help people negotiate all of their debts in exchange for a monthly payment plan to the business. While many of these businesses are legitimate, many others are not. People should proceed with caution when using these services.

While our law office promise that working out debts outside of bankruptcy will always go smoothly, we feel it is usually worth it to at least consider negotiation as a viable option.

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Richard Banks & Associates

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Cleveland, TN 37364-1515
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