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Settlement may not be the debt relief option many hope for

| Jul 2, 2019 | Debt Relief |

Struggling with significant financial problems can make anyone feel desperate. Louisiana residents with this issue may look at numerous routes that promise debt relief but worry about which could be right for them. Having this worry is understandable as some options, like debt settlement, are not always as promising as they may seem.

Some individuals may consider debt settlement a better alternative to bankruptcy. However, this option is commonly too good to be true for many people struggling with debt. Settlement companies often claim that they can work with creditors to lower owed payments, but really, creditors do not have to negotiate with these companies. As a result, a person could pay a settlement company to negotiate on his or her behalf only to have a creditor refuse to work with the company.

Additionally, some parties may think that settlement will have a lesser impact on credit scores and reports than bankruptcy, but that may not be the case either. In fact, charge-offs will stay on credit reports for seven years, which is close to the amount of time a bankruptcy could remain on a report. It is also important to note that many people who attempt debt settlement drop their cases before any of their debts are settled.

Exploring one’s options for debt relief is certainly a wise step to take. Of course, it is important to have the right information about a possible program before diving in. Bankruptcy is a legal process that works to help individuals get back on financial track and has a proven track record of successful cases for those who complete the process. Interested Louisiana residents may wish to gain information on this option from reliable resources, like bankruptcy attorneys.

Facing Overwhelming Debt?