Consumer Credit Counseling to Help Prevent Bankruptcy
Are you interested in debt consolidation services? If you have a lot of debt, you should be. Today’s challenging and turbulent economy is causing consumer debt to rise. Things can get very hard if you have too much debt, even though it’s an accepted part of life for many people. Filing for bankruptcy and getting debt management are usually the most common solutions for financial relief from debt. Less pressure from debt collectors and an immediate improvement in financial situation will be experienced, no matter which avenue is chosen.
Settling debts means that the balance owed will be paid off in just a couple years and only about half of the total debt will actually be paid. Bankruptcy has two forms, which take very different paths: Chapter 7 bankruptcy and Chapter 13 bankruptcy. You won’t have to pay any of your unsecured debt if you choose to use a Chapter 7 bankruptcy, but you will damage your credit doing so. Choosing a Chapter 13 means that you will use a payment plan to pay off all debts within three to 5 years, and after which all debt will be erased. Chapter 13 bankruptcy and debt settlement are very similar in that they both allow you to pay down your debts over a determined amount of time. However, debt settlement does not impact your credit on a permanent basis. Not only can bankruptcy impact your credit, but it can be recorded for up to 10 years, whereas debt settlement is not.
Debt settlement is typically the process of negotiating with debtors to reduce debt, or even forgive it completely, reduce interest rates, lower monthly payments, or even all of the mentioned options combined. The design of bankruptcies is to help individuals pay off their debt and to do so using the protection of a bankruptcy court. This is often called a ‘reorganization’ or a ‘liquidation’ of debt. Through hard work and appropriate planning, all methods can be utilized to reduce debt and get finances back on track. Professionals who specialize in debt management can even help you compare mortgage loans when you’re ready to take that step.
Keep in mind that today’s market offers plenty of debt management services that can help you overcome your financial woes. You should also keep in mind that you can get much higher quality results by getting advice from a financial professional before you make any financial decisions that could impact your overall monetary well-being. You may discover that a debt management plan is your saving grace!
