The idea of choosing a bankruptcy attorney over a debt settlement lawyer may be driving you crazy. At first instance, the latter might appear to be a smarter choice, but then what if you work with a bankruptcy attorney to have your overwhelming debts settled? To know about this issue well, you’ll at first have to get a handle about what bankruptcy as well as debt settlement do to help you out of your financial crisis.
Bankruptcy vs. debt settlement
Based on your present financial condition, bankruptcy can be prove to be the only option that you may have. Your debts may get discharged and if you don’t have any assets, then the bankruptcy court will leave any kind of retirement funds of yours like Individual Retirement Account (IRA) or 401(k) untouched.
On the other hand, given the financial scenario of yours right now, the debt settlement amount may get lowered in the range or 25-60 percent. However, if you are diagnosed with a major medical condition like Leukemia, then sharing all the medical reports as well as prescriptions with the creditors will keep you in good stead to successfully drive the negotiation process to its rightful end.
Why choose a bankruptcy legal eagle for debt settlement?
Though you may hardly miss a television show that does not beam a commercial highlighting all the good things a debt settlement company has to offer to the desperate debtors like you, yet most of them function unregulated and are a cause for huge concern for consumer rights.
This is why the Federal Trade Commission (FTC) has banned these companies from asking for upfront fees without delivering any actual debt settlement services. However, even bankruptcy attorney’s can be a part of a scam and rip you off in the guise of having your debts settled with the creditors.
Still, attorney’s have their license at stake, but that is not the case with the settlement firms who mostly operate with a website and few telephone lines. So, if your bankruptcy attorney misuses your money, then he/she may be penalized with a disbarment. Thus, they are fully regulated by a competent authority to uphold the sanctity of the law and the professionals associated with it.
Yes, there are some really decent and legitimate debt settlement companies operating out there, but you may want to work with only those who’ll set up your account with a debt management plan. So, if you want go for this option, then you must have ample amount of cash flow to continue such a program since you’ll have to make regular monthly payments to the settlement company.
In this case, it is advisable that you find out a non-profit debt settlement company for the purpose and not a fly-by night online financial services firm. However, for a bankruptcy attorney, having your debts settled would be an extension of what he/she does to make a living.
The fact is they are in constant touch with the creditors and know exactly when would a settlement offer work in your favor. Apart from that, debt settlement isn’t a preferred mode of debt repayment option for all and therefore, you need to consult a lawyer about your rights as well as alternatives in relation to your debts.