How can you legally eliminate bills?

The answer is complicated but if you know how it’s done you can legally eliminate debt once and for all.

The founding fathers wrote debt elimination into the Constitution. When establishing the court system for the country, they required only a supreme court and a set of bankruptcy courts. Did you know, Thomas Jefferson filed for bankruptcy twice.

Many famous people have filed bankruptcy also. Donald Trump, Larry King and LaToya Jackson have all filed bankruptcy.

Filing bankruptcy is only one option for people with credit problems. Let’s first explore two less extreme options.

The first option is to consolidate your debt. When you legally eliminate your debt through consolidation, you package your obligations into one loan. Often you can arrange this loan at a lesser interest rate than you had when your debts were freestanding.

Now you pay just one fixed bill.
If you chose a formal debt consolidation program, you will make this payment to your consolidator who will then make the payments to all of the individual lenders.

But sometimes you’re in so far over your head that you can’t make the minimums on your outstanding debt. Simply lowering the interest rate won’t help. That is when you need to arrange with your creditors for a reduction of the loan.

You can often pay only pennies on the dollar for obligations.

Why would lenders comply? Well, they’re afraid that if they don’t facilitate payment, you’ll choose the next option which is bankruptcy. And, they’d rather get partial payment than none at all.

But maybe bankruptcy is the best choice for you. While it has negative costs, especially on your credit report and credit score, a Chapter 7 bankruptcy literally wipes away all of your debt. Ironically, many people find their credit scores actually rise after bankruptcy because so much bad debt is eliminated.

Each year, about 1 percent of U.S. families declare bankruptcy. But Professor Michelle J. White an economist at the University of Michigan believes that 17 percent of U.S. households are in a position where bankruptcy would benefit them.

You can legally wipe out financial obligations. You will be in a stronger position once you solve your credit, debt, and financial problems.