If you find yourself engulfed in a large number of debts, you do not have to worry. Debt relief and Bankruptcy are two forms of relief that could help you recover from this bad state. Both of them will reduce your debt liabilities and help you repay all of the debts. It is essential for both, creditors and debtors. The most commonly adopted option is New York bankruptcy but that does not make it better than debt relief.
How Does Bankruptcy Provide Relief?
Bankruptcy is a process at the end of which you become debt-free. It is of various types such as Chapters 7 and 13. Only non-exempt assets are liquidated to pay off your debts. In some cases, a debt repayment plan is drafted and your valuable assets might not even be touched.
Bankruptcy ensures you become debt-free and bankruptcy cost is reasonable. It includes court fees, fees for credit counseling, debtor education course fee, and so forth. Bankruptcy harms the credit score but gives you a chance to start afresh.
Why Should You Consider Debt Relief?
Unlike bankruptcy, debt relief or settlement is not a legal process. You could either hire a mediator or negotiate on your own. Thus, it proves cheaper than bankruptcy cost. The only issue is that you will have to visit each creditor to negotiate a suitable deal. It could prove to be tiresome and complicated.
Debt relief does not harm your credit score as it does with bankruptcy. You will come out with a good credit score and no or fewer debts. Bankruptcy ensures your debts are discharged; there is no such guarantee with debt relief. Though, the fate of your valuable assets rests in your hands which proves beneficial.
What Proves Better: Debt Relief Or Bankruptcy?
You could choose to go for either as each carries different advantages. Debt relief or settlement and bankruptcy, both, are a form of relief. While comparing debt relief vs bankruptcy, the following has to be considered:
• Debt settlement is not a pre-defined process and depends on individual negotiation skills. Bankruptcy, on the other hand, will make you debt-free regardless of the type of case. Therefore, bankruptcy is a better alternative if you wish to end your debts.
• Bankruptcy harms your credit score. You will have fewer chances of availing future loans while debt relief or settlement will not impact it by much. Debt relief is ideal for individuals who wish to seek further loans while bankruptcy is ideal for those who wish to end all debts.
• Bankruptcy offers tax benefits while debt relief does not. You will have to report the cut in your debt on your taxes. This will lead to comparatively higher tax rates. Bankruptcy does not particularly affect the tax rate.
• While you could hire a professional or ask for debt relief yourself, bankruptcy is handled by a professional. This is the most important aspect of debt relief vs bankruptcy as an expert bankruptcy attorney will handle the case. You could choose to hire an attorney for debt settlement, too.
Contact a Professional Now
Thus, there is no strict comparison between the two and they both prove useful. Depending upon your needs, you will have to choose either. It is crucial to contact an attorney for both the processes. The experienced attorney will handle negotiations smoothly and secure the best deal for you.
You can visit midtownbankruptcy to hire attorneys for bankruptcy and debt settlement. The attorneys will help in initiating the process and take it to the end. Debt relief and bankruptcy are both an option to be considered. Your future goals decide which process you should adopt. Call an expert attorney now and secure yourself a stable and profitable deal.