There are more American consumers on the verge of credit card debt bankruptcy than ever before. Filing for bankruptcy however should always be your last option to get out of credit card debt. There are better options out there. Here we take a look into one of those options known as debt settlement.
Debt settlement or debt negotiation services are intended for consumers and small businesses that are struggling to pay their credit card bills or other unsecured debts such as medical bills. The fact is that some people simply cannot afford to pay their credit bills and when forced with paying the mortgage or the credit cards, the former will almost always prevail.
Credit card debt settlement programs negotiate the actual balance on your credit cards or other unsecured debt bills. Unlike other debt relief programs that negotiate the interest rates and require full repayment, settlement programs negotiate the actual balance and the amount that is settled is not required to be paid back.
When you file for bankruptcy your credit score will be negatively effected for at least 7 years after the filing is complete. Considering the average bankruptcy case takes around three years this means that your credit will be negatively effected for around 10 years on average when you file bankruptcy.
New bankruptcy laws that were passed in 2005 make filing bankruptcy much more difficult to qualify for and far less advantageous for consumers. Ch. 7 bankruptcy which is considered the "fresh start" bankruptcy is nearly impossible to qualify for. You are much more likely to qualify for Ch. 13 which is similar to debt settlement with one major difference. You credit score will be hurt worse with bankruptcy.
0 comments:
Post a Comment