Debt Consolidation, Debt Settlement, Bankruptcy - How to Pick the Best Option?
Though America is considered the most powerful country with the strongest economy in the world, surprisingly even they could not resist the pressure of current economic depression.
It not only created a bunch of desperate credit card defaulters, but also threatened the consistency of the US economy by weakening the strength of financial establishments in America, which they considered to be the stamina of the country.
In order to regain their control as well as to decrease the amount of credit card defaulters, the US government introduced a threefold debt relief options starting from debt consolidation, debt settlement and bankruptcy.
Let us discuss these options in detail so that you can decide which one to choose in your condition.
It is noteworthy that you know both the case and the consequence.
1.
Debt Consolidation It is a debt relief program under which a debtor can merge several credit card debt bills into a single debt.
Imagine that you handle three different credit cards with three different interest rates.
Under this program, you can unite all the interest rates into one and pay a fixed interest.
Ex- (13% + 12% + 15%)/ 3 = 13% So, you can secure a lower interest rate through this program.
Additionally, it stops you from getting two or three notice warnings or payment reminders.
But, make sure that you have a steady income before joining this program unless you do not receive a discount under this service.
2.
Debt settlement This service is best suited for the consumers who cannot handle their minimum monthly payments.
The consumers who are already in the process of filing a bankruptcy case should better follow this process.
Under new chapter 13 bankruptcy law, the debtor is made compulsory to follow a debt settlement program during a period of 180 days.
Through this service the debtor receives discounts ranging from 40% to 60% in most cases.
3.
Bankruptcy Bankruptcy is considered as the worst method of eliminating debts.
Once you get help of this deal, your credit report will be badly affected.
Therefore, you should not try it unless you do not have any other option left to choose.
It not only created a bunch of desperate credit card defaulters, but also threatened the consistency of the US economy by weakening the strength of financial establishments in America, which they considered to be the stamina of the country.
In order to regain their control as well as to decrease the amount of credit card defaulters, the US government introduced a threefold debt relief options starting from debt consolidation, debt settlement and bankruptcy.
Let us discuss these options in detail so that you can decide which one to choose in your condition.
It is noteworthy that you know both the case and the consequence.
1.
Debt Consolidation It is a debt relief program under which a debtor can merge several credit card debt bills into a single debt.
Imagine that you handle three different credit cards with three different interest rates.
Under this program, you can unite all the interest rates into one and pay a fixed interest.
Ex- (13% + 12% + 15%)/ 3 = 13% So, you can secure a lower interest rate through this program.
Additionally, it stops you from getting two or three notice warnings or payment reminders.
But, make sure that you have a steady income before joining this program unless you do not receive a discount under this service.
2.
Debt settlement This service is best suited for the consumers who cannot handle their minimum monthly payments.
The consumers who are already in the process of filing a bankruptcy case should better follow this process.
Under new chapter 13 bankruptcy law, the debtor is made compulsory to follow a debt settlement program during a period of 180 days.
Through this service the debtor receives discounts ranging from 40% to 60% in most cases.
3.
Bankruptcy Bankruptcy is considered as the worst method of eliminating debts.
Once you get help of this deal, your credit report will be badly affected.
Therefore, you should not try it unless you do not have any other option left to choose.
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