Whis is more viable option..??.. debt consolidation or bankruptcy..??
Posted by Cassandra Parker on April 3, 2009
Ongoing economic turmoil takes many people out of their toes & tented for either filing bankruptcy or resort to a debt relief program. Well, now days, many debt relief agencies are popping up rigorously to ecourage more & more debtors to deal in to debt relif program thai in return will earn handfull for those indigenous agencies. Often few among these agencies are plays out with the good faith of their clients & accordingly populates mal practices. Although, the above words doesn’t mean that a debt relief program is bad enough. However, the choice of opting a debt relief program or bankruotcy depends up on the extent of indebtness. On this behalf, an effective credit councelling is inevitable taking in to count all present & probable source of income & respective espenses in line of an efficient evaluation of credit types & extent of obligations( rate of interest & charges etc.). In this regard, it is always apprehensive to have a self appraisal over each & every credit aspects. However, the decision should be made upon the degree of credit obligation. If you are having a huge amount of indebtness, it is often better to draw a line over all the debts rather dumbing them or even consolidating them for an indefinite payment terms. Here, as I have mentioned before the extent of indebtness as well as financial standings & stability of the debtor is a crucial concern. If anyone finds himself/ herself in such a severe situation that he/she has got nothing much left to survive up on unless to surrender the shelter or even the car. In such a scenario, filing bankruptcy is an inevitable option rather than resorting up on a debt relief program. Moreover, a debt relief program like debt consolidation or debt settlement might ask for even more as a collateral to avail a comparetively cheaper rate of interest. This can further take you to the worse & for an obvious reason you may loose up your everything. Henceforth, securing your home rather than stucing in to honor is what most you can opt for. Although, Filing for bankruptcy is the last option one can resort in to, accodingly it binds you with cetain amount of obligations as well, still one can minimise such restrictions to a greater extent with the help of appling for bankruptcy through a lawyear. Although in usual terms, filing bankruptcy blocks your credit score for 8-10 years, however filing such practice under the guidance of an expart can bring it down to as low as two years.
jjeffjackson said
I think there is a huge misunderstanding as to what bankruptcy can and cannot do. Bankruptcy should never be a last resort. It should be considered at the same time as any other program. People need to speak to trusted advisors before making decisions. The big differences between BK and Consolidation type programs are 1) certainty, with BK you know what is going to happen, what it will cost, what will be reduced or eliminated, and how long the plan term will be, you don’t get any of that with Consolidation; 2) an Attorney who will fight your battles with BK; 3) elimination of other judgements and leins, the BK process addresses the legal issues, consolidation does not provide legal service so if you have a judgement or lein placed on property to secure a debt how will the consolidation consultant remove that?; and 4) the bankruptcy trustees are actually on the debtor’s side provided you play by the rules.
jjeffjackson said
To answer your question. My preference would obviously be bankruptcy as the better choice for eliminating your debt. However, there are other options and individual circumstances will dictate which option you should follow. Unfortunately most people who chose consolidation should actually chose BK, they already have significant debt that they cannot get ahead of. Why pay into a program that makes no guarantees and will not help you with the inevitable lawsuits that will come when you have missed many payments?
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debt consolidation said
The idea of debt consolidation has saved many people to be relieved of their debts and improve their credit worthiness. Here are the things that you need to know about it.