Bankruptcy Debt Elimination
How bankruptcy debt elimination stacks up against options
A simple comparison of the pros and cons of filing produce a stark contrast in results. To receive a full discharge through bankruptcy debt elimination requires a federal suit. The rules are well established for an administration provided by the federal government. Private debt elimination is governed by internal policies established by businesses. This leeway creates allows broad discretion, and may be either a benefit or burden upon their customers.
Advantages and disadvantages of official help
Each case filed creates a public record. This record will be found by credit agencies and reported to all potential creditors. After filing, all debts are completely wiped out by Chapter 7 rather quickly (an average of 4 months) and require no further payment unless one of the narrowly defined non-dischargeable debt rules applies. Compare this with private commercial options. Most options requires years of struggle and repayment of most debts, or full repayment of debts. During these years of struggle, many debtors who file Chapter 7 have improved their credit ratings far above pre-filing status, and are well on their way toward financial success in two years. Does it make sense to delay financial recovery for 5 years to reduce un-playable debts? The answer depends on you, and your willingness to accept the penalty exacted for repayment.
The cost of filing Chapter 7 is frequently less than $700. Many debtors pay far more than this to participate in commercial offers, only to later realize that they must file to gain effective relief.