Debt troubles have rapidly augmented in the US during the last few years and consumers have been in tremendous pressure, not only to stop building more debts but also to tackle those that have already made their life like a living hell. However delinquency about debts can harm your financial health to a large extent but on the other hand it seems impossible to wipe off debts by following faster repayment schedules. Nevertheless there are a wide range of options like debt consolidation and debt settlement which can be availed through agencies which offer their services online or law firms which work with prominent lawyers to help you with their prescribed services. These debt lawyers are professionally equipped to deal with creditors, to not only reduce a major portion of the total outstanding balances but can also assist in dealing with creditor harassments thereby providing calm and relief as long as an individual will remain enrolled for this program. Bankruptcy on the other hand is different than the above mentioned debt relief programs. Under US bankruptcy laws there are two major kinds of bankruptcy namely Chapter 7 and Chapter 13. However the Federal Government has modified these laws and according to the new code or laws, not everyone is eligible to file for it and the consumers have to go through a verification test to know whether the individual can qualify to apply for a bankruptcy option. If it is found that the consumer has enough money to cover the entire debts, chances are that he may not be able to eliminate debts by filing bankruptcy.
But when the question arises whether bankruptcy is a better option or debt settlement, a few tips can help you to have a more clear idea:
Bankruptcy may result in a scarred credit report and it may take another 7-10years before a consumer can gain back his credibility and an amended credit report whereas in debt settlement there is loss but only temporarily.
Bankruptcy is known to harm your professional image and it is difficult to get loan for long years and even if a loan is secured by chance it will be granted with much higher interest.
Lastly, bankruptcy is a much more complicated process than debt settlements were the latter can be carried out with relatively less legal hassles.
Debt Settlement has gained immense popularity in US as the most viable option of debt relief than bankruptcy which is case specific and should be filed with caution and care.
