ALL >> Business >> View Article
Overcoming Your Credit Card Debt - Filing Bankruptcy Or Negotiating Your Debt?
Global economy crisis has caused many negative impacts on individuals, especially for those credit card users who have lost their employment. Without a job, how can a cardholder pay back his or her debt on time? When he or she fails to do that, the lenders will take legal actions to get back their money.
All the debtors do not wish to face the debt collection procedures but they can't avoid these when they have lots of missed payments. In order to stop all the phone calls from the lenders, what can the debtors do? They can either decide to file for bankruptcy or negotiate with their creditors to request for debt reduction.
The next question is which financial option is better. Frankly speaking, both solutions bring you to the same goal, i.e. becoming debt free but they have different impacts on your credit score. Let's take a look at the effects on the debtors' credit files first. Make a thorough comparison before you take any action.
In most of the cases, for debtors who choose to settle their outstanding balances through debt negotiation, the negative items will be remained on their credit file for 7 ...
... years. This is because they have to stop making payment to their accounts when they start negotiating with their creditors. They have to prove to their creditors that they really do not have ability to pay back their debts in full.
On the other hand, when the debtors file for bankruptcy, they have to find out whether they are qualified under Chapter 7 or Chapter 13. For those who are qualified under Chapter 7, they can completely "erase" their debts. In normal circumstances, the debtors usually take about 3 months to complete the whole process but the effect will stay on their credit reports for 10 years. However, for those who file under Chapter 13, they still have to pay back their debts in full and the effect will stay on the credit files for 7 years.
Some debtors prefer to declare bankruptcy because they do not want to ask a favor from their creditors to reduce their outstanding balances. They would rather file bankruptcy because they wish to get rid of their debts immediately. In some people's point of view, negotiating debts with creditors is stressful and it takes up a lot of time. In general, the whole debt elimination process takes about 2 years to complete.
Both financial solutions help the credit card users to clear off their outstanding balances but the processes and effects on credit score are different. Being a smart debtor, you are advised to evaluate your financial needs carefully before you make up your mind.
By researching and comparing several methods of eliminating credit card debt, credit card debt settlement is one of the ideal solutions of paying off credit card debt. For more credit card debt elimination tips, visithttp://CreditCardDebtSolver.com
Add Comment
Business Articles
1. How Global Trade Finance Facilitates Cross-border Transactions And Reduces RiskAuthor: Riddhi Divan
2. Innovative Uses Of Nickel In Cryogenic And Marine Environments
Author: Online fittings
3. Implementing Predictive Analytics In Your Abm Toolkit
Author: SalesMark Global
4. Comparing The Top 5 Live Commerce Platforms For 2024
Author: Amy Williams
5. Data-driven Precision Marketing For Effective Demand Generation
Author: SalesMark Global
6. Supercharge Your Sales With Optimized Pipeline Velocity
Author: SalesMark Global
7. Best Japan Tour Packages
Author: bharathi
8. Adani Group Stocks Down 20%; Gautam Adani Indicted In Us Over Bribery Charges
Author: Bizzbuzz
9. High-performance Ss Round Bars: Addressing The Energy Sector's Needs
Author: Neelkamal Alloys LLP
10. The Role Of Modern Washroom Solutions In Maintaining Cleanliness
Author: ritika krishna
11. Why Choose Premium Taxi Services In Kochi?
Author: maya
12. Black Magic Astrologer In Kasaragod
Author: Sripandith05
13. The Health Benefits Of Adding Pineapple To Your Pancakes
Author: maya
14. Top Luxury Resorts In Kerala For Your Dream Vacation
Author: maya
15. How To Start Your Shopping Website In Doha: A Simple Guide
Author: maya