I have about $11,000 in credit card debt I've been avoiding. I need some sort of consolidation. What are the pros and cons for Chapter 13 and a debt consolidation company? Any personal experiences?
2007-04-11 03:11:34 · 8 answers · asked by Ashley Z 2 in Business & Finance ➔ Credit
A Debt consolidation company sometimes are late with you payments, doesnt do their job right, and are not really helping you. Have you ever filed bankruptcy before? Chapter 13 is a repayment plan that you would pay a trustee for 3-5 years, and its is more expensive to strart up...around $2,000 with lawyer fees. More then likely you would qualify for a Chapter 7. Chapter 7 would wipe away all your debt. Chapter 7 filing fees alone are $299.00 without the lawyer fees. Is there another way to do your bills? Maybe get a loan from a bank or something? $11,000 doesnt seem like a lot of debt to me......
2007-04-11 03:21:16 · answer #1 · answered by Fun N Sun 4 · 0⤊ 0⤋
Chapter 13 is Debt Consolidation, talk to a lawyer and learn. Under Chapter 13 the court will take you total debt and make a once a month total they feel you can pay. This you send to a trustee who will handle the paying of you debt. Chapter 13 also rebuilds your credit, so, do not be mislead that it a bad thing. Many people who come out of Chapter 13 have better credit than those who never filed.
Debt Consolidation I not sure of. It may leave your credit rating tainted as it really not have the legality that Chapter 13 has.
How creditors will see this; Debt Consolidation shows you got in a tight spot and could not handle the debt and you can do it again.
Chapter 13 basically the same, only the creditors know you can not file again for a stated amount of years, so, they actually see you as a better credit risk.
Many lawyers give a free first time consultation. What you need to do is find one that free and talk to learn in better detail how this all work and then you can make a better decision as to what you should do.
2007-04-11 03:27:18 · answer #2 · answered by Snaglefritz 7 · 0⤊ 0⤋
Bankruptcy is an absolute last resort and for $11,000 it does not seem worth it.
You should be able to find an alternative way to pay your debts. Have you tried asking your bank for a loan? I did, and I was amazed that they said yes!
If you need more specific help then there are different degrees of debt consolidation that may be applicable to you. Have a look on this website where they explain the various alternatives to bankruptcy. I hope this helps.
Good luck!
2007-04-14 11:35:56 · answer #3 · answered by Anonymous · 0⤊ 0⤋
A Debt Consolidation company will negotiate with your creditors and set up minimum monthly payment plan. But the interest rates will be adding up to your principal balance. And also the debt consolidation companies will not negotiate to reduce your principal balance and god knows how long it will take for you to be debt free by making minimum payments.
Whereas a Debt Settlement company will negotiate with your creditors and brings down your principal debt amount by around 30% to 70% depending on your credit cards. You can make one monthly payment which is customized as per your convinience on all your cards and be debt free within 3-36 months.
There are no hidden costs and upfront fees associated with the monthly payment option.
For more information please call the below debt settlement company who has helped me out with the unsecured debt situation.
http://www.debtfreeafterall.com
Good Luck
2007-04-11 08:30:48 · answer #4 · answered by Hima K 2 · 0⤊ 0⤋
You could benefit from meeting with a reputable credit counseling agency. They can help you develop a budget and can evaluate the extent of your financial problems.
Dave Ramsey offers good suggestions for dealing with debt on your own. If you are having problems getting lower rates or lower payments on your own, then credit counseling could help.
Bankruptcy is a last resort that will penalize you for 10 years. If your situation is serious enough, then it may be something to consider. $11,000 does not seem like enough to warrant a bankruptcy filing, unless you owe substantial other debts.
Good luck!
2007-04-11 04:14:32 · answer #5 · answered by Anonymous · 0⤊ 0⤋
What totally sucked was the fact that after college I had so much credit card debt that piled up and it was really affecting my credit score. I searched around and tried a few of those debt consolidation sites but found that nothing that I tried really worked. I found this kick *** site that helped me alleviate these problems and I want to share it with you.I helped me out so much and I hope it helps you as well.http://getoutofdebt.5gbfree.com/index.html
2007-04-11 07:38:56 · answer #6 · answered by Amanda H 1 · 0⤊ 0⤋
Do not do either!!! You can dig your way out of this mess with a budget and a good plan. Have you heard of Dave Ramsey? He has some excellent books and a great radio show that can be accessed on the web as well. I highly recommend reading or listening to what he has to say before you do anything and I think you'll be glad you did!
2007-04-11 03:21:34 · answer #7 · answered by jazzviolin 2 · 0⤊ 0⤋
Hi,
I used "Credit Solution" to settle my debt and improve my credit score.They managed to reduce my debt up to 58%.It's legitimate.I came accross this company on NBC News Special Edition.Check it out here:
http://www.jdoqocy.com/click-1813149-10467845
2007-04-11 08:38:57 · answer #8 · answered by Anonymous · 0⤊ 0⤋