Chapter 13 bankruptcy – or the “wage earner’s plan”, was set up to allow an individual with a regular income to make up a plan to repay his/her debts, in monthly installments. Even if this sounds like a good plan, it’s best if you look at it as a last resort. There are ways to avoid chapter 13 bankruptcy by carefully managing your debt and seeking professional help.
The best solution out there for you is to find a debt counseling agency. A non-profit organization with a clear privacy policy and a wide range of services is what you should be looking for. Look around until you find one that suits your needs. They will analyze your debt situation and come up with a one-payment plan where you pay all your debts in one monthly installment, instead of writing many different checks to different collectors.
But that’s not all. Most debt counseling agencies have negotiators who will contact your creditors directly and attempt to reduce your interest rates and organize better payment plans which will save you money in the long term. Creditors will have no problem with this – they’d rather see money coming in monthly than having to pursue legal action to get you to repay them.
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