Wanting to get out from under crushing debt is a desire of many people in Louisiana and elsewhere. Of course, finding the right option for reaching that goal can be difficult. After all, it can be hard to determine when a debt relief option is legitimate or is a scam that may only make matters worse. While options like bankruptcy are certainly reliable, some individuals may still want information on other possible paths, like debt settlement.
Some parties may think that debt settlement would be a better option than bankruptcy due to the unnecessarily negative reputation that bankruptcy has. However, debt settlement also has the potential for damaging a person’s credit. Individuals will need to direct their debt payments to a settlement account, which means that their payments are no longer going toward their actual bills. This action results in delinquency of payments, which damages credit scores.
Consumers would also face greater financial difficulty because settlement companies charge fees for their services after the debt settles. While the fees cannot be charged upfront, parties could still owe thousands to the settlement company when the cases are completed. As a result, even if the debt is settled for a lower amount, individuals may still pay close to their original debt amount when including the fees owed to the settlement company.
When individuals are searching for debt relief, it makes sense to explore all available options. Understanding the pros and cons of each avenue could help Louisiana residents make the best choices for their circumstances. If individuals believe that bankruptcy could work for them, they may wish to discuss this possibility with experienced attorneys.