subject: Avoid Bankruptcy With Debt Settlement in 2010 [print this page] Bankruptcy can be defined as a legally declared inability or impairment of ability of an individual or organization to payback its creditors. Generally bankruptcy is initiated by the debtor as a last resort. But this phenomenon is recurring more often than the American government and Americans would prefer it to happen. Although when a person is unable to make both ends meet it may seem like an easy solution to eliminate major financial difficulties, it is best to avoid bankruptcy at all cost.
There are many reasons for avoiding bankruptcy such as credit score, loss of property due to repossession of assets and continued financial difficulty. Despite the belief of many that bankruptcy will get them free from debt forever, bankruptcy will actually multiply financial difficulty for years to come. For example these may include closing of bank accounts, closing of a business, and inability to continue acquiring credit. For some bankruptcy may seem a good way for a "clean slate", but other costs that need to be paid, like alimony, child support etc. get add on.
There are other more constructive ways to get relief from bad debt, which have been introduced lately, namely debt settlement. In this scheme the customer gets an opportunity to negotiate with creditors. The total amount of debt is reduced by 30% to 60% of the total amount. In the year 2010, the debtor has the ideal possibility of getting relief from debt amount through debt settlement.
The debtor gets free from paying the future monthly installments of the debt amount. Thus, if you as a debtor owe the creditors over $10,000 in unsecured debt then it may be an appropriate financial decision to go for a debt settlement. Creditors too find this as a profitable deal as they get some recovery amount as against none in the case of bankruptcy. Creditors have increasingly shown their flexibility and interest to go for debt settlement deals. It is easy to find legitimate debt reduction help in your state and get free debt advice on line.
In order to prevent the country from recessionary economy the federal government has come up with generous financial help to the money lending institutions in the form of stimulus money. The credit card companies have been saved from immediate ruin and in turn have been passing on this benefit to the debtors in the form of debt settlement.
