I just need to know which is the better option.
2007-09-05 05:48:36 · 8 answers · asked by Anonymous in Business & Finance ➔ Credit
You might want to see a bankruptcy lawyer to see if you even can file bankruptcy. The rules have changed. There are two types of bankruptcy. Chapter 7 wipes out the debt; Chapter 13 sets up payment plan. The new rules determine which you can do.
Debt consolidation/repair/counseling companies tend to take their fees up front and trash your credit anyway. There are so many scams out there that just take your money and do nothing.
Have you considered trying to work yourself out of debt? Make a strict budget. Get rid of all the extras and work on paying off one debt at a time.
2007-09-05 06:00:08 · answer #1 · answered by bdancer222 7 · 0⤊ 2⤋
I'm in Consolidated Credit Counseling and I've been in it since 2000. They told me my debt would be paid in 2004. Here's 2007 almost over and I still have debt!! Of course being in the program, I've gotten credit card offers from companies so I can rebuild my credit, which isn't half bad right now. The downside is when it came time for me to get a mortgage, the loan officers all told me Debt Consolidation is just as bad if not worse than a Bankruptcy on my credit report. Talking to the credit counselors at Consolidated Credit says that its just the opposite.
To decide which is best for you though will take some thought on your part. Are you willing to pay a few hundred a month to the consolidation program for such and such amount of time, or do you just want to wipe the slate clean? I was a little over $15,000 in debt, and I pay the program $278 a month, and yet I still owe a little over $1000. It seems like its never ending.
Good luck in whatever route you decide to take.
2007-09-12 04:19:58 · answer #2 · answered by kitty 2 · 1⤊ 0⤋
It's sort if difficult to answer this without knowing more details.
For example, if you own a home an lots of property you will not be able to get a Chapter 7. Under Chapter 13 you will be paying back a portion of your debt.
Under Chapter 13 rules, you can expect to pay the trustee a huge amount of your "disposable income", and you can expect to have a very rough time for the next 3-5 years.
Therefore, you need to look at your current situation and determine where you are at, and how long it's going to take to pay off your debt. So do this:
Sit down and make a very serious budget. How much can you afford to put toward your debt? Can you pay it off within 7 years? If not, then consider bankruptcy.
2007-09-05 09:11:20 · answer #3 · answered by Anonymous · 3⤊ 0⤋
You might want to try debt consolidation first i went went benkrupt and i am now have a very hard time to build my credit back up but i wasn't able to pay my debt plus my current bilss so i had no other option but to file. Rules have changed though so if you go and file you have to cantact a lawyer first to see if you even can file. The paperwork is grusome and annoying and it takes 6 months to get it all done but then you have that black mark on your credit and if you pay off your debt your credit will be even better for the fact your paying off your bills they may be overdue but they will flag your credit and good standings once they are paid off.
2007-09-05 06:11:38 · answer #4 · answered by Anonymous · 0⤊ 0⤋
If you ever want to borrow money again, go with debt consolidation. I also think that route is more respectable- you ran up the debt, and you need to deal with the consequences. I think it's a cop-out to expect everyone else to deal with the consequences of your bankrupcy. There are plenty of non-profits out there that will help you get your $$ in order.
2007-09-05 05:57:16 · answer #5 · answered by cincykt 2 · 1⤊ 0⤋
File bankrupcy law have been change sine April 2005. It is not as debtee hand any more, read about it. The law id more favor to the debtor.
If you ever want have to have second chance in business world, then "DON'T"
I would say try to work smarter, harder and get pay a lot, then you can catch up with your debt.
If you like to get more help, let's hear from you again.
2007-09-12 07:28:29 · answer #6 · answered by L L 3 · 0⤊ 0⤋
The question you have to ask yourself is can you ultimately pay your debts off or not while paying current expenses. Debt consolidation would extend the payoff time. Bankruptcy would wipe them out but be a black mark on your credit report.
2007-09-05 05:53:39 · answer #7 · answered by Anonymous · 1⤊ 0⤋
Contact Consumer Credit Counseling Services at 1-800-388-2227. They are the oldest and largest non profit credit counseling service in the Country.
I used them several years ago and they worked with my creditors and lowered my monthly payments and interest rates. I was debt free in 36-months.
2007-09-05 06:51:26 · answer #8 · answered by ? 7 · 0⤊ 0⤋