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When Bad Things Happen to Good People ...

Bankruptcy May Be Your Option

What is a non-bankruptcy workout?

One of the most problematic aspects of being in a situation in which your debt burden has become unmanageable is that it can lead to a sense of desperation. People seldom make their best decisions when they feel cornered, and few things can make you feel more helpless than being overburdened by debts.

Filing a petition for personal bankruptcy is certainly one way to get out of a seemingly desperate debt problem, but it is not something that should be entered into hastily. Other options may be available that may be more suitable for your situation. Another debt relief choice to consider may be to explore with your creditors the possibility of a workout plan.

Simply put, a workout is a voluntary arrangement between you and your creditors, under which you negotiate for more favorable terms in exchange for not going into bankruptcy.

These new terms may include reduced interest, reduced payments, a longer repayment period, or a reduced overall payment obligation, or some combination of these. For a debtor, the advantages of a workout include avoiding the negative aspects of a bankruptcy while simultaneously reducing overall debt and interest obligations.

Although a workout may not seem to offer much in return to creditors, they will still often see such an arrangement as being preferable to the debtor declaring bankruptcy: they can recover more of what they are owed even if it is not the full amount initially agreed to.

A workout plan may not work in every situation. It is an agreed-upon arrangement, much like a contract, and requires agreement by all concerned. In this sense, it may be advisable to work with an Oklahoma lawyer or a law firm to help negotiate the best terms possible and to craft the workout in a way to avoid unintended consequences, while still offering all concerned an alternative to bankruptcy.

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