Not all fresh starts have to come with a reset. Bankruptcy tends to sound like you are going back to square one and putting a long road between you and good credit. It does not have to be drastic. Sometimes your case would benefit best from a Chapter 13 restructuring.
We will need to get into a couple definitions, especially secured vs unsecured debt:
This is debt of yours tied to material collateral somehow. If you cannot make payments, collection agencies are in their right to seize whatever property or collateral attached to said debt.
This is debt you own based on your own creditworthiness. The big recourse that collection agencies can take, instead of seizing collateral, is taking you to court.
With a Chapter 13 bankruptcy, the courts will help reduce and restructure some or even all debt and develop a plan for you to pay it off over a period of three to five years. There are a lot of legal hurdles to overcome (made easier with representation), but you can reorganize your life and make a plan to pay off your outstanding debts. Reclassifying some of your debt from “secured” to “unsecured” can ease your debt stress by keeping your house or car off the table and keeping all your debt in one place under a single repayment plan.
Examples of unsecured debt
Apart from reclassified debt, many loans and debts like credit card bills, medical/hospital payments and utility bills all represent debt of yours that do not require collateral.
With a Chapter 13 bankruptcy, you can find your feet, take back control and get a new start on your future.