National Legal Debt Centers, Inc., Helping Consumers Avoid Bankruptcy

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Bankruptcy alternatives are available.

Bankruptcy is the last resort in trying to eliminate debt. The majority of people who file for bankruptcy later say they wish they had found an alternative method of resolving their problems and would not do it again if they had the chance. Even so, unscrupulous collectors and the high pressure tactics applied by creditors eager to collect their profits are driving people into the bankruptcy courts in record numbers. And last year bankruptcy filings were at historic highs.

Most people do not realize the difference between the various types of bankruptcy and could easily find themselves paying back a large proportion of their debt anyway, forced by the courts to make those payments. Some are even mandated into credit counseling programs and forced into a lengthy repayment plan. So they wind up with a bankruptcy and repay the debts anyway!

Although some types of bankruptcy may get rid of unsecured debts completely and help stop foreclosure on your home, stop garnishments by creditors and debt collection activities, be aware that there are still many areas it does not help with. Bankruptcy will normally not help in areas like child support, alimony, current taxes, and most government-backed student loans, etc.

On top of this, you have also just ruined your credit for the rest of your life. Not only does bankruptcy stay on your credit report for 10 years and stay in the court records for 20 years, but many people do not realize that applications for home loans and many employment forms require you to answer the annoying question: "Have you ever filed for bankruptcy?" So, in effect, it follows you for the rest of your life. A bankruptcy can also hinder you in many major areas of your life, such as finding a job, buying or even renting a home, acquiring insurance, security clearance and buying or leasing a car. It should be considered as an absolute last resort.

As a note on bankruptcy: Credit card companies are constantly trying to get Congress to change the various bankruptcy laws, making it much harder to take the so-called "easy way out." These organizations have spent over $75 million on "educational programs" for Congress over the last couple of years. They are "educating" them on the reasons why such changes are needed. As a result, Congress is currently trying to pass new laws to make it much harder for consumers to take the option of bankruptcy and to force people into paying the creditors regardless of their personal situation. (Remember creditors only make money when you are in debt. The more debt you are in, and the longer you stay there, the more money they make!)

Before you decide to do a bankruptcy, explore your options.


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Jonathan Hernandez
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