Consolidation
1. Benefits Lower monthly payments
No worry of paying multiple debt collectors every month, pay only one agency Percentage of debt charged by consolidation company Costs for Loan Cost for counseling or negotiation2. Negatives Appears on your credit like bankruptcy Requires you to get another loan If you own a home loan will be tied to your equity Takes between 5 and 10 years to pay off the loan First few years no big change in debt reduction
Does not always prevent creditors from future legal collection actionBankruptcy
1. Benefits Costs between $700-$3000
2. Negatives On credit report for ten years Finances made public record No assets are allowed with Chapter7 Creditors can file adversarial hearing that costs $3000 Credit severely damaged
Debt Relief Program
1. Benefits Payments can stop as soon as the program starts Credit Repair available after a short time Good credit repair options available
3. Negatives Usually only credit card debt and unsecured signature loan
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