Compare Credit Card Debt Negotiation vs. Chapter 13 Bankruptcy

Debt is an integral part of human life. However, too much of debt becomes a great headache. People who are in debt want to get out of it and others want to stay away from it. People, neck deep in debt, have lot of questions in there mind on how to settle their debts. Luckily there are many companies which are willing to help you in settling your debts and streamline your financial life.

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People have lot of questions in their mind when it comes to credit card debt negotiation. It is very important to know what debt negotiation is and how it is different from chapter 13 Bankruptcy. Debt negotiation is a process of negotiation done with the creditors wherein creditor and debtor agree on a reduced amount of payment that will be regarded as full amount.

If you are into bankruptcy, you can file chapter 7 or chapter 13. Chapter 7 bankruptcy is a faster way to start afresh where your unsecured debts are erased. However, it will have a negative impact on our credit history for years. Chapter 13 bankruptcy gives you opportunity to repay your debts over a period of time with lower or no interest. Debt negotiation also works on the same lines.

However the greatest advantage with debt negotiation is the clean credit history. Bankruptcy file stays on your record for 10 years. However credit card debt negotiation does not show any negative record on your credit score. Your credit history only indicates that you are in a debt management program or your debt is paid full.

Another advantage of unsecured credit card debt negotiation over bankruptcy is the amount of payment we can make every month. When you file chapter 13 Bankruptcy, court decides how much you need to pay each month depending on your income resources and budget. However, in debt negotiation, you can pay as much amount as you can.

You can have a separate settlement account and pay amounts according to your will each month. However, it is recommended to make as much payment as you can so that you will be out of debt at the earliest. The good thing is the control you have over the payments to your creditors.

The most important aspect is to decide which program best suits your requirement. If you are an employee and have a steady income, it is recommended to go for credit card debt negotiation because it will not affect your credit score with a negative hit. It is also important to calculate how much you owe in unsecured debt. To be qualified for debt negotiation, the amount of unsecured debt needs to be at least $7500.

However, qualifying amount varies with the credit card debt negotiation company you select. Bankruptcy, on the other hand, should be considered as the last resort when you run out of options. Remember that bankruptcy can be on your credit file for 10 years and will definitely have a negative impact on your financial life for a long time.

Best Debt Negotiation Programs

There are hundreds of debt negotiation companies available to choose from and they all claim they can get you out of debt fast. There are a few that have better reputations than the rest. Here are our top recommended programs to help you become debt free:

• Curadebt Debt Relief - get a free debt quote and free debt reduction plan
• Do It Yourself Debt Negotiation - eliminate your credit card debts in 6 to 18 months