Alternatives to Bankruptcy
 

Alternatives to Bankruptcy 

(a) Do Nothing--the result will be a judgment against the debtor which can be enforced under New York law for 20 years, and a creditor who obtains a judgment can garnish 10% of the debtor’s wages, document the judgment as a lien against property (including real estate) owned by the Debtor and possibly foreclose against that property. (b) Out of Court Workout With the Creditor. For lump sum payments on credit cards, some creditors will accept a payment equal to 60 to 70 % of the outstanding balance and for payments over time, some credit card creditors will accept 80% of the outstanding balance paid within one (1) to one-and-one-half years (1.5 years) from the date of the workout. Before a client considers an alternative to bankruptcy, they should consult with an experienced bankruptcy attorney.