Comparative Analysis Of Debt Settlement and Bankruptcy

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After the recent economic recession in the US, many consumers are struggling to pay off their debt. Debt settlement and bankruptcy are two popular debt relief options that people employ to eliminate their financial woes. But it is essential to evaluate the programs before you decide which one will be the right option for your financial situation.

 

Know the function of debt settlement and bankruptcy:

Both of these programs have different functions because in debt settlement you need to repay less than you originally owed to the creditors. You need to negotiate with the creditors to lower the interest rate on the principal balance that helps to lower the outstanding balance. But you can discharge certain debts completely if you file under chapter 7 Bankruptcy but in chapter 13 bankruptcy you can reduce the payments by stretching over a longer period.

 

Know about the debt settlement procedure:

Debt settlement is basically a simple process, either you can hire the services of a debt settlement company or directly settle your debts with the creditors. The professional debt arbitrators negotiate with the creditors to lower the interest rate on the principal balance. The creditor and debtor both have to give consent on the settlement offer before the debtor starts repaying. But remember you might not be able to negotiate with the creditors until you have fallen behind on your payments for 2 to 3 months.

 

Know about the bankruptcy procedure:

Bankruptcy is considered to be a legal process and you have to file a petition with the bankruptcy court. Once you declare bankruptcy then you can avoid harassing collection calls from the creditors. Before you file a petition with the court you have to complete two hours credit counseling session. If you file under chapter 7 bankruptcy it will require six months to complete the entire process. But you will complete your repayment plan under chapter 13 bankruptcy within three or five years.

 

Expenses involved in these two programs:

When you enroll in a debt settlement program then you should know that you need to pay an upfront fee and the company might also charge a percentage of the amount saved after successful negotiation.

In case of filing bankruptcy you might need to pay a stipulated amount as filing fee. You are required to pay a consultation fee if you hire an attorney to file your petition.

Debt settlement and bankruptcy both can damage your credit report but your credit rating will eventually improve once your start paying off your debts on in future. Remember that you can discharge your debts if you file bankruptcy. Therefore, it will be a feasible option to declare bankruptcy if you are financially strapped and have no other option to pay back your owed amount.

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Guest article by Amy Lewis.

 

Bankruptcy Article

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A blast from the past - Bankruptcy Article

Senate investigating predatory tactics of credit card companies

Credit card debt is the first cause of bankruptcy for many Americans every year.

Statistics show that debt is increasing at a greater rate than income.

It looks as though Senate will be analyzing credit card company practices for increasing interest and late fees and that direct legislation to minimize these actions could be put in practice very soon. In fact, credit card companies, weary of these heightened restrictions, are already beginning to promise to be clearer with their policies toward consumers. They have vocally assured Senate that they will lower penalties and make fine print more easily understandable.

Several studies have shown that these companies use predatory tactics that insure the highest price interest rates and skyrocketing penalties on late payments and default accounts. Additionally, their billing structures allow for double-cycle billing, using an average of your balance over two months to calculate your interest, normally at a more significant amount to the consumer, and a tactic known as “universal default” which allows companies to raise interest rates in a consumer defaults on an account not related to the credit card.

The purpose of new legislation against credit card companies will be to prevent individuals capable of making only minimum payments to be buried under mounts of additional interest and late fees. As of right now, a definite timeline for new regulations has not been established, but nevertheless it will result in improvements for the consumer along with clear, more understandable terms and conditions.

New Century filed for Chapter 11

2000 end has been a horrendous for subprime lenders throughout the entire mortgage market in the United States. To date, over two dozen individual subprime lending companies are either on the cusp of closing or have already done so. On April 2, the financial chaos claimed its most significant victim when New Century filed for Chapter 11 Bankruptcy.

The second largest provider of subprime mortgage loans in the United States, New Century lend out over $51 billion dollars in high risk mortgage loans in 2006 alone. While the company initially enjoyed an abnormally profitable growth and expansion from 2001-2005, seeing stocks reach a high of $66 in 2004, directors were unable to salvage the company from the recently high amount of defaults in mortgage loans that have left the industry severally wounded.

In the midst of plummeting stock prices and a recorded $100 million dollars in liabilities, company officers must still deal with an investigation by the Fed for possible securities fraud and accounting errors. As part of the bankruptcy, New Century officials would like to sell their loan operations to Carrington Capital Management LLC for $139 million.

However, it remains to be seen if the courts will allow such a transaction to take place.

Article to help you organize your finances

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Strategies to help you organize your finances

From a messy financial situation to economic peace of mind: How can you put your finances in order.

Here are some strategies to help you achieve just that:

  • Allow to deduct Bills from your bank account

Is common to pay after deadlines, in such case you are being charged a highest interest rate for credit cards, so avoid this situation by getting your monthly payments deducted directly. Plus, traditional payment methods will cost you time and hassle.

  • Shop around for credit

If you are looking for a loan or some type of credit, do your homework and get all the information on different options to go with the most beneficial.

  • Pay off credit card Debt

Paying high interest rates can be a real bleeding wound for many family pockets. Try and pay more than your minimum monthly charges and add as much as you can every time.

  • Add some extra dollars to your Savings account

Add a little increase every month to your 401k fund. An increase of as little as $100 will grow in the long term since it goes towards the stock portfolio of investments. And remember that only 75% of the extra savings will come out of your check, since your employer will take care of the rest under a proper benefit plan

  • Put your investments in a safe place

Trust your investment to a wise plan that works your money within a time frame according to your retirement expectations.

  • Get organized

Manage your bills in a proper manner and keep your records in a structures plan. You can use a computer program to help you keep track of your income and every expense you incur every month, specially mortgage, loans, and credit card receipts.

  • Avoid Foreclose if you can

Foreclosure is the legal process in which a financial company mainly a bank or other type of secured creditor repossesses and disposes of an immovable property in the case when the borrower has failed to fulfill the responsibilities agreed upon in the mortgage contract with the lending company. Commonly, the violation of the mortgage is a default in payment of a promissory note, secured by a lien on the property. When the process is complete, the lender can sell the property and keep the proceeds to pay off its mortgage and any legal costs, and it is typically said that “the lender has foreclosed its mortgage or lien”.

There are two primary types of foreclosures.

  1. Foreclosure by judicial sale
  2. Foreclosure by power of sale.

The foreclosure process does not take long really; it could usually take as little as 3-4 months to complete. If you are faced with possibility of your home undergoing a foreclosure process, it can be avoided.

How to choose a Credit Counseling Agency

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How to choose Credit Counseling assistance

There are some aspects to consider when selecting the best credit counselor.

It is a fact that some companies, even some of the self called “nonprofit credit counseling agencies,” are more concerned about their own profits than in providing the best possible help.

When you are choosing a credit counselor agency you must be aware of the parameters that ensure you to make the right decision, staying away from credit counseling companies that could take advantage of you.

Here are a few tips to help you choose a credit counseling agency.

  • Look for a company that provides a wide portfolio of services like budget counseling, debt counseling for people with debt problems, mortgage counseling, debt consolidation and negotiation, credit card debt help, how to avoid foreclosure and bankruptcy.
  • Make sure the counseling company is not charging you any fees up front, and every cost is clearly stated. Voluntary contributions usually ring an alarm.
  • The company should have excellent channels of communication, usually a combination of online, phone, mail and If necessary, personal.
  • The credit counseling firm must provide you with a certified professional to manage your case and guide you through the process.
  • Your credit help agency must be covered by an insurance and is focused on client protection.
  • What tools does the credit debt counseling company offer you? Tools include worksheets, payment schedule tables, guiding handbooks, calculators and simulators, CD’s, newsletters, and more.
  • A Better Business Bureau seal of approval also helps in building trust with a credit counseling agency.
  • The company you choose shouldn’t have a minimum debt policy, and help individuals with any amount of debt.
  • A good credit debt payment plan will ensure you are able to pay your creditors by arranging an affordable payment plan and securing the funds to pay for it in a timely manner.
  • Choose a credit debt company that offers different credit debt solutions; this way you can be sure they can provide a personalized plan for every case.
  • A good credit debt company will dedicate you the necessary time to work on your case without rushing to a generic solution.
  • A good credit help agency will ensure that the amount arranged is paid to creditors without keeping it.
  • Make sure the credit help firm upholds a confidentiality policy so your information is kept safe and secret.
  • A trust worthy credit counseling agency must have good relationships with a wide number of credit companies and banks.

These guidelines will help you find the right credit counseling agency.

Emergency Debt Relief

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Debt Elimination Service – Debt Settlement Service – Free debt relief

Most people are looking for a way to pay all of their bills, to catch up on bills, and to simply crawl out of the hole that is debt. Lots of companies and organizations recognize this need, and will sometimes advertise debt relief programs that are supposed to be designed to get you out of debt quicker. But what if you need help right away, and can’t wait years to get your credit back on track? If you need emergency debt relief, there are some specific organizations you should get in touch with. Here are some suggestions.

Our partner firm is an emergency debt relief organization that focuses on negotiating your debt with the companies you owe money to, as opposed to consolidating your debt or getting you to take out a loan to pay back the money that you owe. Professional debt negotiators will take your “case” to collection agencies and propose amounts that would be more suitable for you to pay, since collection agencies automatically take a percentage of the debt you owe for commission; they’ve already received their payment for labor. If you want more information on how the program works, or a free consultation, visit, or call 1-484-313-9785.

Another option you may want to try is www.careonecredit.com; this system is similar to ours, in that the representatives of the company will work so that you can keep up to 60%of your debt. Plans like this are ideal for people who are seeking emergency debt relief, since needing urgent help is usually an indication that you probably don’t have as much money as you would like. This way, even if getting rid of your debt takes a little longer than you would like, you won’t have to worry about paying back the full amount of the debt. On this site, you’ll find information on bankruptcy (most people file for it before they really have to, because they feel they have no other options). You’ll also find information on how to avoid foreclosure and stop taking out loans. You can receive a free online consultation by entering your information on the site, and a representative will contact you a couple of days after you apply.

Of course, some of the solutions for emergency debt relief don’t have to be so “emergency.” You can prevent yourself from getting so far into debt that a way out seems next to impossible. First of all, make sure that you’re not spending beyond your means, and that if you have to take out a loan for an emergency, you won’t have more than one or two major loans to pay back at a time. Also, try not to take out loans if you don’t absolutely have to. Usually, if you take time to organize your budget so that you know how much money you’ll have to spend every month, when emergencies come up, you’ll be able to handle them better. Also, try to put aside a little extra money every month for savings, so that you can borrow from yourself if you need to.

Credit counselors will also be able to help you with getting your finances together in order to avoid emergency debt relief. They can also explain to you the pitfalls of extra fees like principal and interest rates, so that you can avoid unexpected debt.

Sometimes emergency debt relief can’t be avoided, but there are things you can do to help yourself. Contact the organizations listed above for more advice. Good luck!

Business Debt Negotiation Article

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Business Debt Negotiation

Business debt help service

We know how debt can upset the financial situation of a business and even threaten its future. Through a sound business debt restructuring plan companies can settle their debt with creditors and balance their financial situation.

Through years of experience developing the business debt negotiation program, companies have created a personalized process with direct contact to provide the best possible solution to your business debt. Our teams and team from top partner firms have helped businesses small and large, in many industries to negotiate their debt and organize their finances. We know many such companies that can help you.

Getting businesses and people out of debt is our daily work and we are really good at it.

Our debt negotiation program for businesses has proved to be very effective in solving client’s debt problems. Our knowledge of the financial system and the ways to work with businesses to legally manage their debt, altogether with our developed plan to negotiate debt in the best possible terms will allow our clients to get best results with the most favorable conditions, GUARANTEED.

Our success rate make us confident to offer debt negotiation services for businesses that they can afford, to provide solutions to their debt problems in a shorter period of time and in more advantageous conditions to the businesses we represent.

Business debt restructuring or negotiation is a legal, specialized way to bring corporate finances in order in the presence of a high debt situation.

Get personal assistance and find out about the advantages of our debt restructuring, debt negotiation services.

What’s the best option to your business debt situation?

In the face of a bad debt problem and liquidity difficulties some business deal of the alternative of filing for bankruptcy; but truth is that there are strategies and methods to keep a business viable and secure its future.

Did you know that attorney expenses for bankruptcy processes take around 75% of the resources from chapter 11? Is a fact, plus, debt, collection charges and other fees keeps rising, It is possible for businesses in debt to avoid bankruptcy, an expensive and tough process leading to liquidation under chapter 7.

To the heavy expenses related to bankruptcy, add the credit consequences it brings, beside the emotional distress associated. Many companies offer the right solution to business debt problems in a short term. Ask us if you need help with the same.

Debt consolidation Article

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Debt consolidation

Many Americans resort to declaring bankruptcy when their credit card debt reaches alarming levels. But there are alternatives to avoid going this avenue and putting their finances in order. A trust worthy professional debt Negotiation Company can structure a plan to work with creditors and clients to consolidate credit debt and restore their credit history.Many people struggle to make minimum payments to their credit balances and see their debt grow day after day, and lengthening the period to get their debt paid for; sometimes this situation seems like an endless road.

What can you do to find a way out more than the minimum monthly credit card payment:

Make a monthly budget accounting for all of your expenses and keep your expenditures under this budget. Avoid luxurious items and brand products when you can go for less costly items.

Find ways to increase your income by a small percentage (10 or 15) to put into a savings account and add this amount to your monthly payments to pay a bit more.

A simple suggestion: don’t charge any more expenses to your credit card.

Don’t use your credit card to pay for groceries.

Get professional reliable help. Find a fine debt negotiation company to make a plan that can get you an affordable solution consolidating your credit debt under better conditions. This solution is easier than you think and can save you thousands of dollars in interests.

Is possible to consolidate and unify all your existing debts into one, relying on a single loan to cover for all of them. The advantage is that the new loan is made under more favorable conditions like lower interest rates, so your monthly payments can get dramatically reduced.

Many firms consistently carry out this process for you as a client and can lead you to restore your credit record and get back on your feet in a short period of time, usually from 12 to 36 months without the pressure of creditors and collection companies.

Some firm’s record of compliance and satisfaction is so high; that they even offer you a satisfaction guarantee of 100% without risk, no money upfront. Few consolidation companies can make such a claim.

Start taking action to eliminate your debt consolidating all your payments in a lower monthly payment.

Debt Consolidation Tips

Although you can certainly attempt to negotiate directly with your creditors, it’s probably not really a good idea if you don’t know what you’re doing. You could end up doing more harm than good. To successfully negotiate settlements, here are a few things you absolutely need to know:

  • Settling debts is not always about what you know, but often who you know. Getting to the right person and avoiding the uncooperative people can make all the difference between settling and not settling.
  • Creditors and collection agencies are not usually going to write off hundreds or thousands of dollars without a fight. So you better have a thick skin and be willing to persevere…sometimes for several months.
  • You must use different negotiating strategies with different financial institutions and collection agencies. What works with one, will usually not work with another.
  • Creditors routinely threaten litigation. But how do you know whether the threat of a lawsuit is REAL or just a BLUFF? We’ve learned that past performance of a creditor or collection agency is the biggest determining factor. Therefore, you need to know the “profile” of the creditor or collection agency you’re dealing with to know if the threat of a lawsuit is credible.
  • What if one of your accounts is referred to a law firm? Does that mean you’re getting sued? Not necessarily. Although we are NOT attorneys, we know how “they” negotiate settlements with law firms all the time. You just have to know what you are doing.
  • You have to know what constitutes a good settlement offer and what’s not a good settlement offer. For example, a 50% settlement might be a good offer with one particular creditor or collection agency, and not a very good offer with another.
  • Should you attempt to settle directly with the creditor or let the account go out to an agency? Believe it or not, there are times when you are better off by letting the account go out to a collection agency!

Step By Step Guide To Legal Debt Settlement

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A Simple Guide For Individuals Looking For Legal Credit Consolidation Programs-
The first thing you need to know is that you are not alone. America is in debt overload and that means that most Americans are in debt and are looking for a legal guide to credit consolidation. Credit Card companies have caused Americans to become overextended. Just about everyone who is offered credit accepts it at some time. If you are making the minimum payments on your credit cards or feeling over extended each month you need to look hard at your situation and make a debt management plan. If you have recently received late fees or over the limit fees you need to take action now. If you are receiving creditor calls, you are delinquent with your payments, or considering a foreclosure or even bankruptcy we can help. While you are not alone, your situation is unique and you will be treated with dignity by our professional team of representatives.

So What Are All Of Your Options To Get and Stay Financially Free???
If you have been directed to this site chances are you are searching for a way to gain more control over your current debt situation or wanting to find a way to eliminate debt all together. DSLG has several program options to assist you in gaining control and finding a way out of debt. We can also assist our clients with bankruptcy as a last resort.

Did you know that if you have $15,000 in unsecured debt at an interest rate of 18%, are making minimum payments and you….

  • Do Nothing: It will take you 192 months (16 years) and you will have paid approximately $67,200 before you are out of debt.
  • Choose Debt Consolidation: You can expect to be out of debt in approximately 64 months with a payment of approximately $345 (includes monthly processing fees) for a total of $22,080.
  • Choose Debt Settlement: On average, you will end up paying approximately $9,750 to settle the debt.

To determine what credit management plan is right for you fill out the following Credit Calculator (this software will be introduced as a free download link to viewers of legitimatedebtsettlement.com) and it will display your recommendation. It will ask for some financial information. Estimates are recommended.

Important:

Recent Large Credit Card Purchases or Credit Card Cash Advances may not be able to be settled or consolidated. 
DSLG does not perform credit checks and does not report to any credit agencies.