Consolidating debt versus bankruptcy
You now must wait eight years after receiving a discharge in Chapter 7 before you can file again under that chapter.
The Chapter 13 waiting period is much shorter and can be as little as two years between filings.
Debt settlement and bankruptcy are solutions to the same problem – What are the most direct methods for getting out of debt?Bankruptcy, which is adjudicated in federal court, either wipes out your personal debt (Chapter 7) or creates a plan for repaying creditors (Chapter 13).Debt settlement doesn’t require a court filing and, unlike bankruptcy, can often be handled without a lawyer or financial counseling.The reason: its long-term negative impact on your creditworthiness. The consequences of bankruptcy are significant and require careful consideration.Bankruptcy information (both the date of your filing and the later date of discharge) stays on your credit report for 10 years, and can hinder your ability to get credit, a job, insurance, or even a place to live. By using the protection and assistance provided by federal law. ” You’ll find out later that such phrases often involve filing for bankruptcy relief, which can hurt your credit and cost you attorneys’ fees. Other factors to think about: Effective October 2005, Congress made sweeping changes to the bankruptcy laws.
Both types of bankruptcy may get rid of unsecured debts and stop foreclosures, repossessions, garnishments and utility shut-offs, and debt collection activities.