Comparing Bankruptcy and Debt Consolidation
If you have significant balances on your credit cards, you are probably finding that high interest rates, over-limit fees, late fees and costs are pushing you deeper into debt. At the Law Offices of Chad M.Hayward, P.C., in Chicago, our lawyers offer a free initial consultation to discuss solutions to credit card debt. Those solutions may include debt consolidation or bankruptcy.
We serve clients in the Chicago area and throughout northern Illinois.
What is Debt Consolidation?
Debt consolidation involves negotiating with your credit card company to accept less than the full amount you owe. The goal of debt consolidation is to get your credit card debt down to as little as possible (60 percent of what you owe is generally an attainable goal) while eliminating or lowering your interest payments.
However, some credit card companies refuse to accept debt consolidation plans. In addition, some of the businesses that provide debt consolidation services actually get you deeper into debt by forcing you to make large up-front payments before they make any payments to your creditors.
How is Bankruptcy Different from Debt Consolidation?
Chapter 13 bankruptcy is similar to a debt consolidation plan, except it gives you the full protection of U.S. bankruptcy laws. Chapter 13 bankruptcy also protects you from home foreclosure, car repossession, wage garnishments and creditor harassment.
Is Filing Bankruptcy Worse for My Credit Than Debt Consolidation?
Filing bankruptcy can have a negative impact on your credit rating. This impact, however, is usually only temporary. Typically, your credit will begin to improve shortly after filing bankruptcy. If you are currently having serious debt problems, your credit may already be about as low as it can go.
Talk to Our Bankruptcy Lawyers
To schedule a free initial consultation about credit card debt, debt consolidation and bankruptcy with an attorney at our Chicago law office, call 888-804-8641 or fill out the contact form on this Web site. We have staff members who speak Spanish.
Read answers to frequently asked questions about bankruptcy.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
