Finding free money to pay off debt is not very easy, but it is definitely not impossible. Often times, people fall in to debt not because they don't save their money, but because they are hit with unfortunate circumstances in a poor economy. Restaurants that make record profits one year, can completely flounder in their next year. Some Americans fall in to debt because they can't pay their increasingly high medical bills. Young people often find themselves in debt when they graduate college and have to pay off tons of loans which can amount to thousands of dollars. To add salt to the wound, if you graduate during a recession, you might not even be able to find a job. Of course, there are people who make unwise decisions and use their credit card bills without checking how much they have in the bank. However, if you are one of those people who just got unlucky, do not worry. There are many programs and government grants geared to help you get back on your feet. Below, I will show you what steps you can take to find free money to pay off debt. 

The first thing you need to do is stop yourself from going into deeper debt. If you own a business or restaurant, quickly liquidate everything and see if you have any options to avoid filing for bankruptcy. Create a monthly budget and see how much money you need for food and shelter. You should include both mortgage and car payments if you have any. Exclude all existing debt that you have to pay off. Once you have done that, contact consumer credit counselors (CCC) and create a strategy to pay back your debts without having to pay tons of interest. Often times, you can get reduced or even zero interest rates if you work with the CCC. Creditors will usually halt collection agencies from hounding you if you participate in a CCC plan. 

Government grants are free and do not need to be repaid. Nevertheless, it is not easy to get one and you will need to do a lot of paperwork to apply. First and foremost, you must explain your current situation and why the government should help you with your personal debts. Also keep in mind that grants have objectives and stringent conditions. If you were to receive a government grant, you will be expected to comply with their rules and regulations. After you have completed your application, your request will go before a committee where they will review your case. There will many other people like you who will also be applying for the same grant so please be aware that a rejection is more than likely if your reasons are inadequate. 

Many of these government grants that provide free money target organizations such as non-profits, public schools and state and local governments. As far as individuals go, most grants are geared towards minorities, single mothers, people with disabilities and veterans. If you fit in to one of these categories, you are more than likely to be qualified to request a government grant. When you write your application, describe your situation as clearly as possible. Do not exaggerate or make stuff up on the application. Once you have been approved of a grant, the government may conduct background checks and interviews to confirm the truth.

If you have tried the tips above but failed to receive free money, you may simply need to file for bankruptcy. Usually, you should file for bankruptcy if you are old, have a large amount of debt, have small cash reserves or have a lot of dependents. Filing bankruptcy means that your credit score will be obliterated, and you will be barred from starting your own business or obtaining loans for many years to come. Getting free money to pay off debt is not an easy process and not everyone will qualify.