Consolidate Debt	Bankruptcy	Avoiding Foreclosure	Get Out of Debt

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Bankruptcy Alternatives / Debtor's Options

Lifestyle FAQ

Q. Lifestyle!? I have no life anymore. What are you talking about?
A. That's exactly what I'm talking about. Becoming a debtor and dealing with the psychological problems and lifestyle changes associated with it, is an important topic. You may need to deal with your debt emotionally before examining the various methods for eliminating the debt.

Q. You mean other people feel the same way I do?
A. Sure, that's the first thing to understand. You aren't the first person to get in debt and you won't be the last.

Q. While that may be comforting to know, how does it help me?
A. I'm going to go through some of the stages a debtor experiences. It may be refreshing to see where you've been, helpful to see whats ahead and important to beware of certain pitfalls before you get there.

Q. These stages make it sound like dealing with death or something.
A. Exactly! Think of it as the death of your financial well being. I've included below an exerpt dealing with reactions to loss from a University of Illinois page entitled "Grief and Loss" written to help students deal with the death of a loved one. I'm sure you will find many, if not all, of these feelings familiar:

1. Denial, shock, numbness -- reactions which distance the grieving person from the loss, thereby protecting him/her from being over- whelmed by emotions.
2. Emotional releases -- these reactions accompany realizations of different aspects of the loss, they frequently involve much crying and they are often important to the healing process.
3. Reactive depression -- natural feelings beyond sadness (e.g., feelings of loneliness, isolation, hopelessness, self-pity) which occur as the person more clearly recognizes the extent of the loss. For many, reactive depression is part of the necessary internal processing of the loss which the grieving person must go through before reorganizing his/her life.
4. Panic -- feeling overwhelmed, confused, fearful, unable to cope, and even believing something is wrong with oneself.
5. Remorse -- following a loss (whether through death, relationship breakup or disability) a grieving person sometimes becomes pre- occupied with thoughts of what he/she might have done differently to have prevented the loss or to have made things better. This can be helpful as the person tries to make sense out of his or her situation, but can also lead to unrealistic feelings of remorse or guilt.
6. Anger -- this is a frequent response to a perception of injustice and powerlessness. A significant loss can threaten the grieving person's basic beliefs about himself or herself or about life in general. As a result (often to the grieving person's bewilderment), he or she can feel anger not only at a person perceived as responsible for the loss, or at God or life in general for the injustice of the loss, but also -- in cases of loss through death -- at the deceased for dying.
7. Need to talk -- in order to recognize and come to terms with the impact of the loss, the grieving person may express feelings, tell stories and share memories, sometimes over and over with many different people.
8. Physical ailments -- in response to the emotional stress of grief, many people are more vulnerable to a variety of physical ailments over the six to eighteen months following loss (e.g., colds, nausea, hypertension, etc.).

Q. Wow, I've experienced all of those, what else can I expect?
A. Just about every debtor I have spoken to has had some trouble sleeping.

Q. Do most debtors feel so torn apart?
A. I'd say yes, in particular those who face the foreclosure of their home. I've written down some reasons foreclosure can be more devestating than a natural disaster to prove the point.

Q. What should I watch out for?
A. Beware of letting your financial troubles destroy personal relationships, especially with your spouse. Few things in life cause more tension then resolving a debt crisis. I've read that over 75% of divorces involve financial problems (here's the article about debt and relationships). Don't blame each other or lash out at each other. During these days you will need each other more than ever. Avoid finger pointing, couples need to draw even closer during times like these and move forward as a team no matter how hard it may be.

Q. Does it get better?
A. Yes, in time there will be acceptance of your situation. When this occurs you will find less stress and more sleep.

Q. How long will that take?
A. Most often many weeks or months, it depends on the person, the depth of the problem and how the situation becomes resolved.

Q. Can I do anything to help speed up the process?
A. Mostly it just takes time, but there are things you must do. First you may have to change your attitude about debt.

Q. I owe the creditors money and I must pay them back, how can I change that attitude?
A. It's certainly honorable to pay creditors every dime you owe them. It's true that most people do and that if everyone defaulted on obligations the economy would collapse. It's true that most people go to work each day, but some do not, some lie in the hospital. When they get better they go back to work. When you have gotten past your current financial problems you will go back to paying creditors in full. For now you probably can not. Many options exist to fix your debt problems with easier terms or without payment in full.

Q. I could pay them back over many, many years. Isn't that what I should do?
A. In the hospital the doctor tells you a terrible infection rages through your leg. Either you can become a cripple and limp the rest of your life or have a painful operation which will have you back on your feet in a matter of months, fully recovered in a few years. What would you do? I'll assume you'd take the operation.

Q. What about the guilt I'm feeling by not living up to my obligations?
A. When banks make loans they expect some to end up in default, that's a part of the interest rate you pay. Believe me, the fact that your note goes unpaid doesn't mean your loan officer worries about a roof over his head or that the bank president can't sleep at night. Your actions will not affect the way they live their lives or the financial stability of the bank or the lives of any of it's shareholders. They will not feel guilty about taking your home or demanding money so your children go hungry. Do not feel badly for them, think about you and your family.

Q. What about my reputation in the community?
A. Other than creditors most people won't know about your situation unless you tell them. Your reputation may end up tarnished among those who know, accounts may have to be paid COD, some businesses may not want to deal with you at all. You will find that with very little effort any vendor who does not want to deal with you can be replaced.

Q. What other changes in lifestyle should I expect.
A. In the short to intermediate term most debtors find they must change their spending habbits. Until you get back on your feet you should establish a new budget that you can live with even if it means no more nights out, a cheaper apartment, making adult children pay rent or their own tuition, changing eating habits to lower the food bill, dropping cable TV, not giving gifts, driving a less expensive car, and the list goes on.

Q. That's a tough list to start with, do I have to do all that?
A. You have to do what it will take for your own situation, it may be worse than that list. By the way, this doesn't represent the "start" list, this list comes into play only after you have solved your initial problem.

Q. What initial problem?
A. Why are you in debt? This question must be answered and steps taken so it does not happen again before any workout, debt settlement or bankruptcy begins. If you lost your job get another, if your business drove you down close it, if you have chronic credit or spending problems get counseling, if you have drug or gambling problems quit. These may be tough demands but without this step solving the current financial crisis will only be the introduction to the next.

Q. Is there ever a light at the end of the tunnel?
A. Yes, as hard as it may be to imagine now, the goal here is to be able to look back years from now at the events of today and say it was a blessing in disguise, maybe even the best thing that has ever happened to you.

Q. How can that possibly be?
A. Unlike human death as discussed above, think of the debtor as a Phoenix or Firebird. From your financial ashes you will be reborn. When you rebuild a new financial base old debts will be gone. Your spending habits will be smarter. In a short time you can become richer and stronger than before. You may become a six million dollar man! In the long run you will see that workouts and bankruptcies can really give the debtor a new lease on life.

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Nothing contained herein should be construed to constitute advice for your personal circumstances. This is intended as a peripheral exposure to the various options available, but by no means is this a comprehensive or exhaustive analysis of the bankruptcy laws or their alternatives. Whether or not you should file a Chapter 7 bankruptcy, Chapter 13 bankruptcy, or any bankruptcy, will vary depending on your personal circumstances and should only be undertaken after careful consideration, analysis and after consultation with an attorney experienced with such matters. These pages may contain information and rules peculiar to the Commonwealth of Massachusetts.

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