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What Are the Benefits of Debt Settlement vs. Bankruptcy?

When weighing the choice of debt settlement vs. bankrutcy, you need to consider the law. Debt settlement has become even more attractive as an alternative to bankruptcy due to the new bankruptcy laws which make it much harder to file and wipe out your debts. The process used to be much quicker and simpler leading many people to file bankruptcy and start over instead of working off the debt through debt settlement or debt management consolidation services.

Given the new reality (ie-laws), debt settlement can offer these advantages vs. bankruptcy:

    1. You can typically rebuild your credit faster
    2. Bankruptcy is no longer a simple way to wipe your financial slate clean so you still may be required to pay back some of the debt you owe depending on your situation
    3. You still will likely have to incur legal fees with bankruptcy due to the new laws that complicate the process more than before

And most importantly, with debt settlement you will not have to check “YES” when an application asks you “Have you ever filed for bankruptcy?” It’s the dreaded question that nobody wants to have to answer affirmatively. You should avoid it if at all possible.

In both cases your credit suffers