In an era where a good number of people are mired in debt, with no possibility of paying up in the next couple of years, it is worth the while to compare the 2 most possible courses of action one can take: Debt Settlement versus Bankruptcy.
What is debt settlement?
Let us start by understanding what debt settlement is. Settlement is a legitimate option by which those who are burdened with debt can find relief. When a borrower carries with him or her a debt of 10,000 dollars or more, he is qualified to seek for debt settlement. Since the debt settlement is crafted to help those in financial difficulty, a borrower can take this course without the need of a lawyer and without the need to go to court. This means that the route of settlement minimizes expenses and will help you to eliminate credit card debt without filing bankruptcy.
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A debt settlement process can be completed and concluded within 1-3 years. Once the settlement is concluded, the debtor's credit score is restored and he or she gets ranked again as a prime borrower. Finally, by going for settlement, borrowers are contributing to the pump priming of the economy and helping it go back on track.
What is bankruptcy?
Bankruptcy is a drastic option that borrowers can take. Bankruptcy is a declaration that the debt taken can no longer be collected. But then of course, this is not a free ticket to get rid of one's debts. This is only possible after a borrower goes through an almost traumatic process of being evaluated financially, from head to toe. The evaluation result depends on the findings of the credit counselor. They could vouch for bankruptcy, or recommend lifestyle change in order to free up some amount to pay the debts. So, an extensive scrutiny does not guarantee the borrower a way out of his or her debt.
If the debtor does get the nod to file for bankruptcy, the long and arduous road of a legal process commences. This means the services of expensive lawyers will be required, and appearances in court during hearings will be a common part of one's schedule for the next few years. This is expensive and time consuming, not to mention the emotional drain that is part of the package.
When the verdict is finally released, a borrower gets his or her final prize, a destroyed credit rating and becomes ranked as a sub prime borrower, where credit cannot be had for another 7 up to 10 years. this is why you need to get help to eliminate credit card debt without filing bankruptcy.
The balance
The weighing scales points to the fact that debt settlement is the better option than bankruptcy. A debt settlement company will help now and help you to get out of debt quickly before it gets any worse.
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