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Return To Bankruptcy Article Archive   Debt Settlement Versus Bankruptcy - Which is a Better Option to Eliminate Your Credit Card Debt? By Eric Robertie You may be one of those people who are forced into bankruptcy just because there is no other way out of financial distress. It is important for you to know though that, before having to file for bankruptcy, every possible option should be explored as bankruptcy causes serious damage to your credit report to say the least. Companies that offer debt settlement provide programs to help those qualified to repay their debts without having to resort in filing for bankruptcy. Most people assume that just because their payments are already past due and their credit is already bad, bankruptcy won't do any more harm. But then again, bankruptcy is severe and is preferably for those who have exhausted all other efforts. It will reflect on your credit record for up to 10 years. So whenever you apply for a credit card, a mortgage loan or even apply for a job, you cannot hide this fact. On the other hand, opting to negotiate down your credit card debts will show your attempt to repay a debt and will only be reflected on your credit record for a maximum of 7 years. A "settled account" notion will appear on your credit record, meaning that you repaid your creditor according to a mutually agreed amount. Now that we have explored the long reaching effect of debt management and bankruptcy, take a moment to consider the immediate differences of each. When you enroll in a debt settlement program, you are simply picking up the phone and speaking with a credit counselor about your finances. If approved for a program, you will sign a contract and payments will be deducted from your bank account according to the agreement. In bankruptcy, you will be required to disclose every asset that you own, your income and expenses. If you own more than you are permitted to keep according to your state's exemption laws, you may be forced to surrender it to the bankruptcy court who will liquidate the item(s) to repay creditors. Moreover, you are required to appear for questioning by a court-appointed trustee hired to oversee your bankruptcy case. So, when you look at the immediate differences between debt consolidation or debt settlement and filing for bankruptcy, it's obvious that the latter should only be chosen as a last resort. Learn how to negotiate credit card debt down and eliminate it. Learn how to get debt relief through debt negotiation keywords: debt settlement | bankruptcy alternative | negotiate debt | debt negotiation | eliminate credit card debt Debt Settlement Letter

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