There is no denying, people nowadays struggle with debt and if you found yourself in the same situation, there are some options that you could choose from. Now, you should know, if you’re thinking about opting for consolidation or bankruptcy, there are differences between the two options. Hence, to make it simpler for you to choose a more suitable option, here is what you need to know about choosing either of the alternatives:
Option 01: Consolidating Your Debt
The first thing that you have to know about consolidating your credit is that it’ll lower the interest rates you have, but more importantly, it’ll combine all the payments you owe into a single one, meaning that it’ll be easier for you to handle your debt. There are several ways that you could apply for such a program. For starters, you could apply for a union program through a company or agency that’ll collect your payment and send it to the creditors until you pay for it entirely.
Additionally, you can apply for this program through a lender or bank, but with this, you’ll have higher fees. Before you opt for this option, you should learn everything about the company you’re thinking about working with, hence, ensure that you read a lot of reviews such as the one on Credit Associates Dallas TX Reviews. The beneficial thing about choosing consolidation is that it’ll turn your mortgages into one and there are also decreased interest rates.
Option 02: Bankruptcy
Another option that you can choose is to file for bankruptcy, however, you should opt for this after you’ve analyzed your income and credits, and if you determine that you won’t be capable of repaying. There are two bankruptcy options – chapter 7 will require you to sell all the assets you owe, except the things you need for surviving that include furniture, your house, clothes, vehicles, and so on. Everything else will be sold.
Chapter 13 is a suitable choice for you if you wish to make sure that you keep specific assets that you own. It’ll require you to return all the non-discharged debts over the course of 3 to 5 years, and it’ll require you to make a recurrent payment. An important benefit of filing for bankruptcy is that you’ll be capable of starting fresh. Both of the options will eliminate all foreclosures, debt collections, repossessions, as well as utility shut-offs.
Although both of these options may be suitable for you, you must guarantee that you completely analyze your debts and income, as well as the options you have. Additionally, you may want to speak to your legal representative, mostly because they’ll be able to advise you on the best approach that you could take. By doing all of these things, you’ll be capable of determining which is the most suitable option for settling the debts you have.
Since you now understand the differences between the two options, you really shouldn’t waste any more time. Instead, you should do a bit more research and the options you have in order to choose the best thing for the problem you’re in.