subject: Your Consumer Debt Solutions - How Government Tax Breaks Make it Easier to Eliminate Debt [print this page] Your Consumer Debt Solutions - How Government Tax Breaks Make it Easier to Eliminate Debt
Consumer debt is a real problem that is mainly caused by the bad state of the economy. The government is doing its best to solve this problem by giving consumers debt solutions. Despite this fact, there are still consumers which prefer to use bankruptcy rather than spend a few moments online reading about the advantages of these debt relief options.
The main advantage can be also your biggest loss if you don't know how to take advantage of it. Personal loans are unsecured and so you don't have to give anything back if you choose to file for bankruptcy. You can use this as leverage and negotiate with your creditors to settle on a smaller amount, this is known as debt settlement and can get you 50% off your debt. The point is that if you don't know about this fact and you just file for bankruptcy you will end up spending a lot of money and waste a lot of valuable time; it will take you a year to complete the process, but don't think that after a year your are done because after you are declared bankrupt your credit score will plummet and so decrease your chances to get a loan in the future.
If you use bankruptcy as a threat and opt for debt settlement you will see that it can be easy to clear debt in a legal and ethical way. The rest that remains after negotiations can be easily paid at low interest rates in 2-3 years. You will also see an increase in your credit score as soon as your debt gets reduced because it represents the total amount of debt you have and if you are late with payments, this means that as soon as you clear your debt, your credit score will be high and so you will financial stability.
If you are thinking about the fees that a debt settlement company asks for you can relax because they aren't very high and you can also find free companies that will provide help. Also you don't have to pay taxes for the process because the government grants tax relief to settled debt to encourage consumers to use this option.
Debt settlement is a viable alternative to filing bankruptcy. Most consumers are able to eliminate at least 60% of their unsecured debt while avoiding many of the negative consequences with filing bankruptcy. If you are over $10k in unsecured debt you will be eligible for debt settlement.
