Credit Counseling

• If you’re unable to stick to a budget, and your creditors refuse to let you work out repayment plans, contact a credit counseling organization. “Many of these counseling organizations are nonprofit, and will help you resolve your financial problems, but that doesn’t always mean that you won’t have to pay a fee,” according to the Federal Trade Commission. You may be charged a high fee, or asked to make a voluntary contribution. A reputable credit counseling organization features certified counselors who are trained in consumer credit, and can help you develop a budget that allows you to pay off your debts.
  
  

Debt Management

• If you are too far in debt, and have debts that can’t be paid, a credit counseling agency can refer you to a debt management plan. Enrolling in a debt management plan requires you to deposit a specific amount of money each month with the credit counseling organization, which is distributed among your creditors, according to your payment plan. Your payment plan can last as long as four years, and you can’t apply for or use credit cards while you’re in the program.
  
  

Home Equity

• Transferring your debts into a home equity loan not only lets you pay a lower rate, but your payments are also tax-deductible. "However, you're using your home as collateral, so if you can't make the required payments, you can lose your home," according to Credit Loan.com.
  
  

Compromise

• Before approaching your creditors about a payment compromise, determine how much money you have available to live on, and how much money you have to pay your debts. Once you have this information, contact each creditor, explain your circumstances and offer a solution. “Be prepared to give an explanation of why you missed payments, your current and prospective future income, other obligations, and your plan to keep your account current,” according to the Virginia State Cooperative Extension. If creditors are local, visit them in person, and if not, contact creditors by phone or letter. Write down the name of the person you talked to, and follow up with correspondence summarizing your agreement.
  
  

Bankruptcy

• Declaring bankruptcy is not something to be taken lightly. Your credit score is negatively affected, you can lose assets and receiving credit to buy a home or vehicle can be very difficult. “Finding employment can be difficult after a bankruptcy,” according to WhenToFileBankruptcy.org. Before filing for bankruptcy, explore all your options, such as loan modification, a short sale on your home, credit counseling or debt management. Sometimes, bankruptcy is the only option left, and hiring a good bankruptcy lawyer can help you through the process. If you can’t afford an attorney, you can file bankruptcy on your own.