Bankruptcy vs. Other Debt Relief Options

The tremendous amount of credit card debt in the country is not only a national problem, but it also affects the lives of many consumers in Ohio. While bankruptcy is a viable option, consumers may want to compare the pros and cons of it with other debt relief options. The most appropriate first step is to make a list of creditors and the amounts owed to them.

To make an informed choice, a consumer must learn the unique aspects of each option. Some require the consumer to take out a loan, and homeownership might be necessary for security. Solutions exist for those whose debts are still manageable, and for those with overwhelming debt, more drastic and aggressive remedies are available.

Options to research include mortgage refinance by which a home equity loan can consolidate debt. However, the consumer must be sure he or she can maintain the monthly payments while at the same time avoid further spending on credit cards. If the problem is short-term, the minimum amounts can be paid on credit cards — only if an anticipated money source will be available soon to catch up with back payments. Credit counseling and debt settlement options are available, but consumers must keep in mind that creditors are free to proceed with debt collection actions while these processes are underway.

Some Ohio consumers choose to seek guidance from an experienced bankruptcy attorney who can explain the pros and cons of each debt relief option to allow the client to find a remedy to suit his or her unique financial circumstances. A skilled lawyer can also explain the protection offered under the Bankruptcy Code. Armed with the necessary information, the consumer can make informed decisions about matters that will affect future financial stability.

Source: bills.com, “Debt Relief: Compare Your Top Debt Relief Options“, Daniel Cohen, Accessed on Dec. 30, 2016