Debt Settlement vs Bankruptcy? Here is a Quick Comparison.
Is filing for bankruptcy your only choice or can you look for debt forgiveness elsewhere?
When you have reached a point in your financials where you cannot pay your creditors and your mortgage is falling behind, it is probably a good time to consider how you want to handle things before they get even more out of hand. What are your options? Is filing for bankruptcy your only choice or can you look for debt forgiveness elsewhere?
Filing for bankruptcy goes through the court system with your attorney and a judge and will become public record. It involves reorganization or liquidation of assets and once you file for bankruptcy, your creditors will stop calling you for collections. Bankruptcy can be expensive and you need to pass a test in order to file but the end outcome can be a complete removal of any debt. Keep in mind though, that you will have this on your records for possibly up to ten years, which can affect your financial future.
Debt settlement is when you or your attorney will attempt to get a portion of your total balance due as final settlement. This does not come without costs. Usually your creditors will look for a percentage to be added on to the fees that you will be paying. However, debt settlement does not come with damage to your credit report and public record.