How to Avoid Bankruptcy in Philadelphia
- 1). Contact a credit counselor approved by the U.S. Department of Housing and Urban Development. Visit the HUD website to find a credit counselor in Philadelphia or the surrounding suburbs. Examples in 2011 included Intercultural Family Services Inc., Neighborhood Assistance Corporation of America, Consumer Credit Counseling Services of Delaware Valley, and the Philadelphia Council For Community Development.
- 2). Describe your credit and financial problems to the counselor in Philadelphia. Allow the counselor to obtain a copy of your credit report listing your debts.
- 3). Ask about alternatives to bankruptcy, including debt management plans and debt settlement. Debt management plans are a specialty of credit counseling agencies. For a monthly fee the agencies will manage all of your unsecured debt, such as credit cards. The counselor will directly contact your lenders to negotiate payment programs to eliminate or greatly reduce your debt over about four years. You will be required to pay a monthly fee for the management services and also send the agency a lump sum check each month covering the minimum payments. Debt settlement is usually self-directed or directed by for-profit agencies. This bankruptcy alternative allows you to resolve unsecured debts by paying less than the full balance owed.
- 4). Schedule followup meetings with the counselor in Philadelphia as necessary as you decide on an alternative to bankruptcy.