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Benefits of Debt Settlement

Debt Consolidation vs Debt Settlement

Debt Relief vs Bankruptcy

Pitfalls of Declaring Bankruptcy

Reasons for Debt Consolidation

The Bankruptcy Process Explained

What Is Debt Consolidation?

What Is Debt Negotiation?

What Is Debt Settlement?

What To Do if You're In Debt

 

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Pitfalls of Declaring Bankruptcy

When all other options have failed, those who are mired with extensive financial debts may find themselves facing the option of declaring bankruptcy.

There are two kinds of bankruptcy for which Americans are able to file: Chapter 13 and Chapter 7.

Chapter 13 bankruptcy, also known as “reorganization bankruptcy,” is designed to allow consumers to repay creditors in full or in part. Consumers are given a three to five year window to repay their debts according to the terms of the bankruptcy agreement. Chapter 13 bankruptcy allows the debtor to keep their assets because they have agreed to work out a repayment schedule for creditors.

Qualifying for Chapter 13 bankruptcy involves an individual’s ability to prove they earn enough money to be able to repay their creditors during the length of the repayment process. If a debtor is unable to prove financial ability to repay, they will not be permitted to file under Chapter 13.

The other kind of bankruptcy is known as Chapter 7, which involves all or some of a person’s property being sold in order to settle their debts. Some property, such as clothing, vehicles and furniture, is considered exempt and cannot be liquidated during Chapter 7 bankruptcy.

There are some pitfalls to filing for bankruptcy that should be considered prior to making the move.

The most serious pitfall is that it will negatively affect one’s credit report for 7 to 10 years. It can lower one’s credit score, which will make it incredibly difficult to secure new lines of credit, including credit cards and loans.

Filing for bankruptcy also can affect a person’s ability to secure future employment. In today’s employment environment, prospective employers have made it routine practice to conduct full background checks on candidates for hire – which includes a copy of one’s credit report. Over 80 percent of employers who were polled in 2012 said they use background checks and financial reports as a factor in the hiring process.

Those who have spotty financial histories are less likely to be hired than their more financially-secure counterparts.

Another hidden disadvantage to filing for bankruptcy is that the state and federal governments may not be required to provide tax refunds annually. Any money that may have been refunded could be garnished in order to pay creditors.

Those who have successfully filed for bankruptcy also can expect to pay higher interest rates for credit cards and other loans – if they are even able to secure them. Like consumers who have bad credit and low credit scores, those who have filed for bankruptcy can expect to be subjected to outrageously high interest rates for the duration of their bankruptcy and sometimes even a few years beyond it.

Another serious disadvantage to bankruptcy is that it may not clear all debt that is owed. Even in the case of Chapter 7 bankruptcy – when a debtor’s assets have been liquidated in order to pay creditors – some debt will remain exempt from the bankruptcy process. The holders of that debt may come back on the consumer for repayment of the full amount owed.

While there are both advantages and disadvantages to filing for bankruptcy, consumers must evaluate their individual circumstances and then determine which outweighs the other before making the decision to file. Thankfully, there are other options, such as debt consolidation and debt settlement, which can help a consumer much better than declaring bankruptcy. A knowledgeable debt relief company can guide consumers through which option is best for them.

Saving Somalia Through Debt Relief

Somalia needs humanitarian aid to stem its short-term suffering, but that cash will not break the country's deadly cycles of drought, hunger, and poverty. To do that, the IMF must forgive Somalia's crushing debt, just as it has for nearly every other ...

Published:  Fri, 17 Nov 2017 08:17:00 GMT



China makes no offer of debt relief for Venezuela

China isn't offering debt relief to Venezuela but says it's confident the country can deal with the matter. The statement Thursday from the foreign ministry came a day after Russia and Venezuela signed a deal in Moscow that envisages Venezuela will pay its ...

Published:  Thu, 16 Nov 2017 00:25:00 GMT



Freedom Debt Relief Suggests 8 Steps To Aid Financial Recovery From Disasters

SAN MATEO, Calif., Nov. 17, 2017 /PRNewswire/ -- This year, more Americans than ever are dealing with the aftereffects of fires, floods, hurricanes, accidents and acts of violence. Plus, the season of snowstorms and blizzards is not far away. For people ...

Published:  Fri, 17 Nov 2017 03:00:00 GMT



The Trump Administration Has Yet to Approve a Single Student Debt Relief Claim

For-profit college magnates Corinthian Colleges and ITT Technical Institute shuttered operations in recent years after facing state and federal investigations into fraudulent and predatory practices. After the school chains closed, tens of thousands of ...

Published:  Thu, 16 Nov 2017 01:28:00 GMT



Freedom Debt Relief's Andrew Housser Cautions Consumers to Avoid Holiday Overspending

SAN MATEO, Calif., Nov. 16, 2017 /PRNewswire/ -- Thanksgiving is around the corner, and with it, temptations for holiday shoppers: Black Friday and its sibling, Cyber Monday. As the holidays approach, Andrew Housser, co-founder and CEO of Freedom Debt ...

Published:  Thu, 16 Nov 2017 03:00:00 GMT



China Will Not Help Venezuela Ease Debt Burden as Country Enters Default

The Chinese Foreign Ministry has signaled that it will not offer a debt relief package to Venezuela, yet China reiterated confidence that the Maduro regime will pay off their debt. Venezuela has borrowed billions of dollars from both Russia and ...

Published:  Fri, 17 Nov 2017 18:02:00 GMT



Debt Consolidation Reviews: Top 10 Jungle Warns That Household Expenses Are Driving the Debt Boom

Top 10 Jungle produces debt consolidation, debt relief and personal loan comparison charts for consumers and small business nationwide. DALLAS, Nov. 11, 2017 /PRNewswire/ -- Top 10 Jungle, a leading provider of slick digital content and online product and ...

Published:  Sat, 11 Nov 2017 06:19:59 GMT



China isn't offering debt relief to Venezuela but says it's confident the country can deal with the matter

BEIJING (AP) -- China on Thursday made no offer of debt relief to Venezuela, but said it was confident the country can deal with the problem. The statement from the foreign ministry came a day after Russia and Venezuela signed a deal in Moscow that ...

Published:  Thu, 16 Nov 2017 02:18:00 GMT



15% Yielding Unsecured Debt

J.C. Penney is by no means a thriving company, but survival may be good enough to make the unsecured debt a profitable investment ... Sears recently got relief from its Pension Benefit Guaranty Corporation obligation allowing it to retain enough cash ...

Published:  Sun, 19 Nov 2017 16:10:00 GMT



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