Bankruptcy or Settlement

If you have tons of debt and feel like bankruptcy might be your only choice, then I want to tell you that you are doing the right thing by researching your options. There are other alternatives to bankruptcy that can help you cut your debt and give you a way out without the drastic reduction in your ability to be approved for credit within the next decade.

Bankruptcy or settlement

Debt settlement is one of the best options for those who are facing bankruptcy. If you aren’t to the point of hopelessness and do have some income coming in, and have areas of your financial obligations where you can cut expenses and catch up on your bills, then that is by far the best option. However, if you are already past the point where you think you could ever catch up then Debt Settlement can allow you to legally pay off your debt for less than you owe without the devastating effect on your credit.
Bankruptcy Vs Debt settlement – Helpful Tips you can use to make the right choice
Here are 7 things you should do to decide upon bankruptcy vs settlement.
1.    The very first thing to do is get a copy of your credit report. This will help you see exactly how much you owe to all of your creditors (like your credit cards) and what negative items you have being reported to the bureaus such as collections, late payments, and what accounts have been charged off. This will give you a very good idea of where to start.
2.    Add up your total debt being reported to the bureaus. Notate which have been charged off and tie those to the collections being reported (don’t add the two together). Also, notate how much your interest rate is on each to highlight which ones to pay off first.
3.    Figure out ALL of your income. Be sure to include your paycheck, bank savings account, any rental income, alimony and/or child support, investment returns, etc. If all of your income together is less than your basic financial needs including rent/mortgage, utility bills, gas, monthly food bill, etc., then you shouldn’t go for settlement. This is because you can hardly save anything to settle your bills with a lump sum payment after a certain period of time. However, if you’ve thought of filing bankruptcy, calculate your average monthly income for past 6 months (gross monthly income divided by 6) preceding the month you file bankruptcy. The average monthly income is compared to your state median income to find out whether you qualify for Chapter 7 or 13. Moreover, you need to find out whether you can afford the costs of filing bankruptcy.
4.    Double check to see if you even qualify for settlement help. You need to have at least $5,000 to $10,000 of unsecured debt for help from any respectable settlement company to negotiate with creditors on your behalf. However, if you have less, (or even if you have more) you can settle your debts yourself if you know what you are doing.
5.    Investigate to see if bankruptcy will be able to eliminate all your dues. It is essential that you double check to see whether bankruptcy can even delete all your bills. Not all your bills can be discharged through bankruptcy. Depending upon your outstanding balance on each account and the type of bills you have, bankruptcy may or may not be the right option for you.
6.    Understand the consequences of filing bankruptcy. You should be aware of ALL the consequences of filing bankruptcy. A bankruptcy WILL affect your credit score by hundreds of points and will automatically rule you out from certain creditors lending to you at all. Remember a bankruptcy can be legally reported for 10 FULL years. If you want to get approved for credit within that time frame be aware that obtaining credit will be difficult at best. If you file Chapter 7 bankruptcy, depending on your state law, it may require you to sell your home or car. Which is why it is better to avoid bankruptcy at all costs. Or at least to only use as the last option.
7.    Understand that debt settlement can hurt your credit. If you choose to settle your debts, either yourself or through a settlement company, you’re still likely to damage your credit score at least temporarily. Many times creditors will not be willing to settle your debts UNLESS you are delinquent on your bills. However, unlike with bankruptcy, part of the negotiation with creditors is that you can get them to report your line as “Paid as Agreed”. This is risky and should only be used if there is no way to be current on your bills.
Whether you choose to settle your debts on your own, use a settlement company, or file for bankruptcy be sure to fully understand all of the consequences. Remember that when you discuss bankruptcy with an attorney that they have a vested interest in you filing bankruptcy, however, if you go with settling your debts first, if it is not successful you can always file for bankruptcy later. If you start with bankruptcy it would not make sense to try settling your debts. Go to debteliminationadvisory.com today

Bankruptcy or settlement
 

This free website was made using Yola.

No HTML skills required. Build your website in minutes.

Go to www.yola.com and sign up today!

Make a free website with Yola