Debt settlement vs bankruptcy - which option is more consumer-friendly?

Dec. 7, 2010 - PRLog -- Due to the world wide recession, almost every individual is being affected from this. People are getting laid off from their jobs and high inflation has really put them in deep financial crisis. They are unable to manage their expenses in limited funds which compel them to get help from credit cards to overcome this problem. Credit card companies take full advantage of this situation and charge high rate of interest on total outstanding amount. They also charge late payment charges and other hidden charges due to which the debt amount piles up rapidly. In this worse situation, people usually file for bankruptcy. People opt for this option because they have no other alternatives available. People consider this option as a last option. This method can give relief to the borrower but it is not considered good for the stability of the economy therefore, the federal government has come with few options which are beneficial for both the debtor and the creditor.

Debt settlement is considered to be one of the best alternatives as compared to bankruptcy. This method is suitable for all those who have more than ten thousand dollars of credit card debt and by using it; they can get up to sixty percent reduction in the liability. In order to get benefit from this method, you will have to hire the financial expert of the settlement company to negotiate with your lender to get the reduction in your liability. They also manage to get more time for you to pay the remaining amount in easy monthly installments. The Company will charge you an affordable fee which is nothing as compared to the benefits which you will get.

So it is advisable to all the people who are suffering from the pain of credit card debt that do not file for bankruptcy initially as this method is expensive, time consuming, requires many legal documentations and also affects the credit rating badly. On the other hand, debt settlement is affordable, time saving and does not require too much legal documentation. This method is getting famous with every passing day and if you will adopt this method then you can also apply for further loan after paying the settled amount.

If you have over $10,000 in unsecured debt it may be a wise financial decision to consider a debt settlement. Due to the recession and overwhelming amount of people in debt, creditors are having no choice but to agree to debt settlement deals.
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