For many people, debt is a major issue in their day-to-day lives. Connecticut residents seeking debt relief, particularly for unsecured debts like credit cards, have several options available to them. From consolidation plans to Chapter 7 bankruptcy, there is a solution for every debtor depending on his or her particular circumstances.
For example, it is possible to borrow against oneself in the form of taking out money from a 401(k) or borrowing against life insurance. However, these can both be risky propositions. If an individual leaves a company before paying back the loan, that money is due immediately. Similarly, borrowing against life insurance runs the risk of leaving family members with less financial stability if the debtor is to die before the loan is repaid.
A home equity line of credit is also an option. This means an individual borrows money using his or her house as financial leverage. This can be equally as risky as borrowing from a 401(k) or life insurance, however. In the case of a line of credit of this type, defaulting on the loan could lead to foreclosure.
There are a variety of ways for Connecticut residents to seek debt relief. For those in the most difficult circumstances with debt they cannot reasonably afford to handle, the option remains to seek Chapter 7 bankruptcy. Unsecured loans like credit cards are often forgiven by bankruptcy court, especially with the support of an experienced attorney working with the court to arrange the bankruptcy. This can help ease the financial burden on an individual or a family, allowing them to regain their financial footing.
Source: wreg.com, “Three non-traditional ways to pay off credit card debt“, Eryn Taylor and Zaneta Lowe, Nov. 7, 2017