subject: Personal Debt Relief - Bankruptcy Vs Debt Relief [print this page] When people are confronted with huge sums of unsecured liabilities they think the only option to get out of liability is to file for bankruptcy. But this is not true as this problem is faced by many individuals now; there have been the evolution of new alternatives to solve this problem because bankruptcy was causing many problems.
If you compare bankruptcy with the other options of debt relief, you will find that if these alternatives were not introduced the economy would have fall down.
Debt relief is the reduction of debt to eliminate it and it can be accomplished through various means and methods. Like debt consolidation plan and debt negotiation. Debt consolidation is one of the most popular debt relief programs. It is acquired through combining of multiple loans in to a single loan with lower interest rate so that you can easily pay. Debt negotiation is the process in which professionals arbitrate with the creditors to reduce the total amount that you owe. This reduction can be up to from 50% to 75% making the rest amount to be paid as full amount. Late fees and taxes are also deducted.
There are many advantages of financial relief. Your credit score will be affected but it won't remain on your credit report for long. You will be able to save thousands of dollars and prevent a debt from occurring in future. This is the fastest and simplest solution to your credit problems.
On the other hand bankruptcy is one of the most traditional ways to become debt free. There is a very long procedure that you might have to undergo when you file for bankruptcy. Although due to bankruptcy all of your debt dilemmas come to an end, the ramifications of the whole process cannot be dealt easily. All of your assets will be seized to clear the debt. Your creditor will decide the structure of repayment.
There are just too many disadvantages of bankruptcy. Your credit scores will be extremely lowered and this blot will remain on your credit reports for almost 10 years. It will create a lot of dangers for you in future. Like if you want to get a mortgage loan, or a job or if you want to get an apartment on rent.
So keep bankruptcy as a last option if God forbid you come in a situation where you are left with no other choice. First attempt all the debt relief options and don't be delayed on paying your bills, start the debt relief options immediately in order to debt free as quickly as possible.
If you are over $10,000 in unsecured debt it would be wise to utilize a debt relief network instead of going directly to a debt settlement company. Using a debt relief network guarantees that the debt settlement company you choose has been certified and has established success in negotiating settlements. They are free to use and a good starting point to begin your debt relief process.
