There are significant distinctions among the companies offering debt settlement which should be fully understood before consumers finalize any actions that could threaten such devastating conclusions when poorly begun. Many of the financial professionals working midst debt se... (READ MORE) Settlement loan negotiation continues to gain ground as an increasingly popular form of debt relief, but careful borrowers – worried about the stability of the relatively new program – don't want to leave anything to chance. Along with a committed and arduous investigation of the background of relevant settlement loan firms, the borrowers should also check upon the settlement loan company's bu... (READ MORE) However important it may be for borrowers to give the benefit of the doubt to the professionals that they have entrusted with the day to day practicalities of family debt relief, there are still so many differences to be found between the varying philosophies of settlement loans to keep each borrower interested in the fundamentals. Unfortunately, too many consumers who’ve spent the time succes... (READ MORE) |
Bankruptcy Filings
With the current state of the American economy in such peril and average households across the country struggling with their bills as never before, the bankruptcy courts had already been bracing for a new surge in filings for Chapter 7 and Chapter 13 protection. However, given the new realities of either sort of bankruptcy filings and the elevated incidence of failure following the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act, bankruptcy should now be considered as only a last resort, when other payment options are not available or not possible. Chapter 7 bankruptcy filings have become – through congressional legislation enacted at the behest of the credit card corporations – unreasonably difficult for ordinary Americans to claim, and, though Chapter 13 bankruptcy filings remain the birthright of every American consumer, there’s limited rewards available from that program since the trustee doesn’t do much more than organize the borrowers’ payment schedule.
Worst of all, some of the borrowers do not even intend to end up filing for Chapter 13 bankruptcies in the first place. Indeed, many Americans – especially those with outrageous credit card bills and other unsecured obligations – simply assume that they’ll be able to qualify for Chapter 7 before learning (once they’ve already spent the hundreds of dollars required when filing for bankruptcy) that their income would prevent any governmental protection beyond the minimal assistance of Chapter 13. Borrowers whose bankruptcy filings were submitted with the intent of eventually discharging their high interest credit cards and other unsecured loans must recognize that Chapter 7 bankruptcy protection is no longer any sort of guarantee irregardless of the debt balances held by the consumer filing bankruptcy petitions.
At the same point, not every borrower that ends up filing for the Chapter 13 bankruptcy program does so based on legal mismanagement or faulty information. The majority of Chapter 13 bankruptcy filings in the last few years came about principally for protection of the primary residence for Americans who earn a decent income but nevertheless fell behind on their mortgage payments and found the lenders unwilling to compromise. Through the automatic stay, home owners can shield their family dwelling from foreclosure up until the last minute by well timed bankruptcy filings, but there will be a serious cost to both their pocketbooks (between administrative fees and the ever more necessary lawyers) and their future credit opportunities. If the Chapter 13 bankruptcy filings weren’t intended to save a family home through re-structuring delinquent mortgage payments, the borrowers would likely be better off taking advantage of debt settlement negotiation or another of the new debt organization programs.
Since, with settlement negotiation, the borrowers do not have to cede formal obligations to the settlement company, they should have a far easier road of recovery regarding credit reports when compared to bankruptcy filings for Chapter 7 or (the credit bureaus and FICO scoring system make no separation) Chapter 13 protection. In terms of borrowers who are single mindedly filing for bankruptcy so that they may maintain their primary residence, settlement negotiation shall be less effective for obvious reasons – secured lenders have no need to barter since their loans could legally satisfied through foreclosure – but, with the grand majority of recent bankruptcy filings spurred on by credit card bills, settlement negotiation may yet be a more effective solution for ordinary consumers who simply want to see their mounting credit accounts taken care of.
Got Debt? Need Debt Relief?
The decision to reach out for help with your debt is not one that's easy to make. You were raised to "do the right thing", but now it’s nearly unbearable. You struggle along while your creditors are turning up the heat. And now you’re at the point where the late fees, penalties and interest expense make it impossible to keep your head above water.
Ask yourself this. If you could eliminate your debt without permanently damaging your credit, why wouldn't you?
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