If you are not sure about debt settlement, following points will help you clarify where you stand. There are 2 types of debts, non- eligible and eligible. If your debts fall under the eligible debts, you need a debt settlement plan. If you don’t wish to use debt settlement, the other options available are also listed below.

Usually this is a last resort option for most people due to the fact that it can appear on their credit report for up to 10 years. Bankruptcy is also a matter of public record for anyone that wants to know and can seriously affect your ability to be approved for credit. Even after a bankruptcy has been removed from your record, you are still required to disclose it on forms and applications; even applications for employment. Filing bankruptcy requires you to appear in Federal Court for at least one hearing, possibly more. In addition, certain types of bankruptcy require a court-appointed trustee to control and oversee your estate. Thanks to the new bankruptcy law, debtors will now have even more hoops to jump through when trying to file for bankruptcy. Some of the new requirements include pre-filing consultations, with an approved consumer credit counseling service, in an attempt to force debtors to pay their obligations outside of bankruptcy. Additionally, in order to file bankruptcy, a debtor needs certification from that credit counseling agency before they are able to move forward. The new law also includes an income-based "means-test" that determines which debtors possess the ability to re-pay some of their debts. Those who don't pass the means test will be forced into a Chapter 13 bankruptcy rather than a chapter 7.

Bankruptcy can have an adverse affect on your life and lifestyle long after the legal matters are over. This is not a decision to be taken lightly. Bankruptcy is an option that should only be explored as an absolute last resort to solving your financial problems.

Note: CreditSettler.com is not a law firm nor can we provide legal advice or any other type of legal advocacy. For bankruptcy related questions concerning your situation, you must contact a licensed attorney in your state.

Consumer Credit Counseling agencies (also known as Debt Management companies), were originally established to help credit card companies recover revenue from clients that were falling behind on their bills. Often this is a nonprofit organization that is funded in-full or in-part by contributions from creditors. You make one monthly payment to the Consumer Credit Counseling agency, and then they disburse your funds and pay each of your creditors for you.

A Consumer Credit Counseling agency will usually be able to get your interest rate lowered and stop the harassing collection calls. It is important to understand, though, that you will pay the full balance owed on your various accounts with interest. In other words, your creditors will not be forgiving any of the remaining balance that you still owe.

Choosing to use a Consumer Credit Counseling service can have negative effects on your credit that last up to 10 years. These services are also considered Chapter 13 Bankruptcy by most lending institutions. The bottom line is that most Consumer Credit Counseling companies work for your creditors, not you. By using their services, you will end up paying back everything you owe, plus interest.

Debt consolidation programs provide consumer loans based on items of equity. You must own a home, have some property or have some assets to pledge as collateral for this kind of loan...otherwise a loan isn't even an option at all. For example, a home equity loan is used to "combine" your debts into a single monthly payment, which can often take 20 to 30 years to repay, depending on your on financial situation. Borrowing from Peter to pay Paul is no way to get out of debt. You're still going to have to pay back the money to someone. It is however, the premise behind debt consolidation programs.

Also this may seem like a viable solution in the short term, but missing payments on a secured loan could cause you to lose your home and any other collateral you pledged. It is not a good idea to exchange your unsecured debts for secured ones.

For most people this is not a practical solution, but technically it is an option. An example where doing nothing might work for you would be if you were unemployed and had no assets a creditor could pursue. Essentially you would be "judgment proof" and your creditors would (at least temporarily) hit a roadblock. However, this does not mean that they can’t come after you at a later date...when you least expect it.

Today’s consumers require the most efficient way possible to resolve financial hardships. Debt settlement programs provide their customers with a viable solution to an otherwise complex problem. Most creditors will agree to accept less than full balance to settle outstanding debts By helping reduce your current debt, our program provides you with a way to regain control of your finances within a reasonable time frame. Debt settlement is fast becoming the only true option to financial recovery outside of bankruptcy!