If your overwhelmed by debt, sick of creditors calling you and struggling to make your payments don't worry, you’re not alone. Millions of MN residents are struggling with debt and truthfully finding someone these days that is not is like finding a needle in a haystack – virtually impossible. 1 in 3 people carry credit card debt month to month and hundreds of thousands have debt in collections. Most of the time at no fault of their own. Wouldn’t it be nice just to eliminate it all? Could you imagine how much less stress you would have? Just imagine how well you could sleep at night! The good thing is that’s a possibility. When it comes to resolving overwhelming debt you have 4 options.
1. Do Nothing
That’s right, one of your options is to do nothing. Sure, you can go ahead and avoid your debt problems and try to postpone dealing with them but eventually they’re bound to catch up to you. You won’t be able to avoid them for forever, the overwhelming stress will continue to build, your credit will never get better and aggressive credit or debt collection activity will never stop. At first it might sound appealing and easy but in the end you will find it’s one of the worst decisions that you can make.
2. Debt Consolidation
Debt consolidation is the second worst decision that you can make and merely a waste of time. Similar to doing nothing, debt consolidation is just another way to mask the real problem and postpone debt freedom. Plus, whether you choose a debt consolidation loan or hire a debt consolidation company, in the end, you will always end up paying more than you were originally liable for. Lenders make their money by offering lower payments and interest rates and by extending your payments for a longer period of time. This creates a profit for them on top of your original debt. Debt consolidation companies do the same thing for a fee to attempt to negotiate the lower payments and interest rates, but there are no guarantees the negotiation will be successful. The worst part is a lot of the times the creditors and debt collectors refuse to work with the company leaving you stuck in the same position you were in when you started.
3. Chapter 13 Bankruptcy
In simple terms Chapter 13 Bankruptcy is an easy debt re-payment plan based on what you can afford. There are three major differences between Debt Consolidation and Chapter 13 Bankruptcy. First, when you File Chapter 13 Bankruptcy in MN, the terms of your re-payment can end in as little as three years. Second, your payments are determined by what you can afford after you pay after you account for your necessary and reasonable living expenses. Unlike debt consolidation this means you get to eat first and the creditors eat second. Third, after your plan is completed, your remaining debt is discharged – tax free!
4. Chapter 7 Bankruptcy
Chapter 7 Bankruptcy, also known as the “fresh start” bankruptcy is the best way to eliminate all of your unsecured debt quickly and easily. Within 120 days you can be relieved of those financial obligations. If you have creditors and debt collectors screaming at you daily for money filing Chapter 7 Bankruptcy will bring that to a screeching halt. It is an immediate stop to debt collection by court order. And in most cases, bankruptcy exemptions allow you to keep the property you need like your car and house. When you file a Chapter 7 Bankruptcy you’re immediately able to get back on the road to a debt-free life again!