Debt Settlement Or Bankruptcy
Debt Settlement
Debt Settlement
The Debt of every individual is increasing day by day due to his desires. There are mainly two types of debts,
Secured debts- these debts are backed by collateral security such as home, car or any other asset. Secured debts cover home loans, car loans, re-mortgage and many
more.
Other debts which are not owed by any collateral security are called Unsecured debts, like personal loans, credit cards, etc.
All the things were going well until the recent recession phase reached the market. Debtors are now facing lay offs, wage cuts, pink slips, not able to pay regular
monthly credit card payments. The financial bodies that were providing credit card were finding hard to collect money from their debtors. This phase led many financial
bodies to move out of business. The federal government came with the stimulus money, directing all the financials to draw their debts as bad debts. Any debtor who owes
a debt of over $10,000 qualified for debt erasure. He was sent to relief agencies who helped and negotiated with the creditors to not only bring down the current
interest rates but also to reduce upto 50% of outstanding debts balance. Hence the debtor with reduced debts are able to live a debt free life in span of 3-4 years.
The only thing the debtor need to aware of, is to check the authenticity and legacy of the debt relief agency and provider.
What is Bankruptcy?
Bankruptcy is a legitimate process in which debtor eliminates his outstanding debt balance by selling his assets or by following a suitable payment plan. A consumer
can apply and file for bankruptcy under chapter 7 or chapter in accordance to his financial situation. There is a common belief that one could be relieved from
clutches of debts by going bankrupt, which is not a truth. The fact is you are making your finances worse, when you are in strain by bad debts, filing a bankruptcy
is making your position worse. The credit score hits an all time low of 200-250 points. This all leads you on a road where you will not find any bank or finance
institution for at least a decade. All of your assets will not be for your family, for your future they will be taken by government for repaying your loans. In
nutshell, the debtor is left with no home, no car, with no credit score or credit history to support his family for a bright future.
Why debt settlement the last call before bankruptcy?
The big question is bankruptcy or debt settlement? As a debtor one has to choose the best solution between bankruptcy or debt settlement to get rid of debts. Certainly
debt settlement wins by majority of positive notes. By approaching a well renowned and reputed debt settlement firm a debtor will again travel on a road of no debts.
His credit score will return back to normal in 2-3 years which is the time he will pay back to his creditors without fear of losing his assets or goodwill.
Finding a right and suitable legitimate debt settlement firm is not that complicated but debtor must know where to look.There are many websites on internet who work
for free It would be wise to employ their service that will determine your case for free and give you some free quotes, like this we will be having many quotes and we
can choose the best out of it. We should never work with companies or individuals who charge money for the quotes and put you in more financial stress.
by: Austin
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