Worcester Debt Settlement Lawyer
Are you looking for a debt remedy?
Various debt solutions exist for people that are in financial difficulties.
One of the more common remedies is debt settlement, which is the reduction
of the amount of money owed on unsecured debt. Occasionally, debt settlement
may result in a reduced interest rate or reduced monthly payment. Debt
settlement can be problematic, even though it may initially appear to
be a viable debt remedy. To begin with, you will not be able to settle
a debt unless you are already months behind on your payments. Another
disadvantage is that in most situations, you must pay off the entire settlement
amount as soon as it has been negotiated.
If you have multiple debts, agreements will need to be reached with each
creditor, every one of whom will be seeking the highest payoff possible.
You may also be pressured into sending a percentage of the debt you have
agreed to pay on an immediate basis, often without a detailed written
agreement regarding the terms and conditions of the settlement. Not every
creditor will agree to a settlement, which can leave you will legal situations
that still need to be resolved, such as a foreclosure, repossession or
Unlike bankruptcy there is a hidden fee in each and every settled debt.
Settled debt is taxable. For example if you settle your $20,000 credit
card for $10,000 you will pay income tax on the $10,000 you did not pay.
If you are in the 15% tax bracket, this means you will send the IRS $1,500
in on April 15. There is no tax on debts discharged in bankruptcy.
Many people find that even the reduced payments offered by debt settlement
companies are unmanageable. In many cases in bankruptcy these same people
would pay nothing towards their debts.
Debt settlement companies typically have higher fees than that of your
bankruptcy lawyer. Debt settlement will typically cost more in administration
(the cost of the service) and require you to pay back money you may not
otherwise have to repay in bankruptcy.
Debt settlement is reported negatively on your credit report and will continue
possibly for years until settlements are reached with each of your creditors.
Once bankruptcy is filed, there will be no further derogatory marks on
your credit report allowing you to quickly rebuild your credit in 2 - 3 years.
Before signing up with a debt negotiator come meet with a Worcester Bankruptcy
Lawyer here at the Kovacs Law Office and learn about your options.
If you can no longer meet your financial obligations, contact a
Worcester bankruptcy attorney to discuss all of your options. A skilled lawyer will explain the pros
and cons of debt settlement and other financial solutions so that you
can make the best decision possible regarding your financial future.
Bankruptcy Lawyer in Worcester
Many people considering debt settlement often find that filing for
bankruptcy is a better method of addressing their financial condition. As soon as
your petition is filed, the court will issue an automatic stay which will
put an immediate stop to:
- Creditor harassment
- Wage garnishment
Law Office of Robert W. Kovacs, JR. is a respected bankruptcy firm that
can give you advice regarding your finances and how to get out of debt.
Our firm can discuss the many benefits of bankruptcy and how it compares
to debt settlement so that you can properly evaluate your debt relief choices.
Contact a Worcester bankruptcy attorneyfor advice regarding debt settlement and other debt solutions such as filing