Bad Credit Consolidate Eliminate Debt Chapter 13 Bankruptcy Starkville Mississippi By Denvil Crowe

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When you just can´t pay your bills, debt consolidation sounds appealing, but it has serious limitations. It´s important to understand the difference between consolidation loans from a finance company or bank, credit counseling payment plans, and Chapter 13 bankruptcy.

Chapter 13 bankruptcy combines your debts into a single monthly payment. Unlike other debt consolidation options, it is backed by the full power of the Federal Bankruptcy Code.

Chapter 13 bankruptcy offers many advantages.

1. Automatic Stay: When you file Chapter 13 bankruptcy, a court order prohibits further collection activity against you. This automatic stay can stop foreclosures, garnishments, repossessions, lawsuits, license suspensions, and harassment by bill collectors.

Other types of debt consolidation have no stay provisions. Because no court order protects you, creditors can continue collection actions against you.

2. Put More Types of Debt Under Control: Almost all your debts can be controlled with Chapter 13 bankruptcy. One affordable monthly payment can include mortgages, vehicle loans, credit cards, taxes, medical bills, past-due child support and alimony, and personal loans.

Other types of debt consolidation include allow only specific, limited debts (usually just credit cards); they usually omit important debts like mortgage arrears, tax debt, car payments, and child support arrears.

3. Reduce Debts By 100%: Most people are passing the "means test" under the new bankruptcy law. They pay $0.00 on credit card debts, personal loans, medical bills, and other dischargeable unsecured debts.

With other consolidation plans, you have to repay some or all of the interest plus 100% of the principal. Any non-bankruptcy ad that promises "debt reduction" is tricking you by talking only about interest, not principal.

4. Gives You the Force of Federal Law: Bankruptcy law tells creditors what to do and how and when to do it. Non-compliant creditors can be hauled in front of the bankruptcy court and penalized.

Other types of debt consolidation do not have the power of law to dictate what the creditors are paid. They merely request that creditors lower interest rates; there´s no reduction in principal. Credit counseling repayment plans are voluntary for creditors; at any time, they can stop participating, regardless of the consequences for you.

5. A Definite Time Period, and Then You´re Done: Chapter 13 bankruptcies usually last between 1 and 5 years. At the end, all dischargeable debts are eliminated.

Other debt consolidation plans can drag on for years without significantly reducing the balances you owe. They could leave you in debt and damage your credit record.

6. NO Interest or Late Fees: As soon as you file Chapter 13, any existing debt stops accruing late fees. In most cases, the little that has to be repaid is interest-free. This includes credit cards, personal loans, medical bills, and other unsecured debts, regardless of whether they are dischargeable. Generally, all payments toward your unsecured debt are applied toward principal. This drastically reduces the time required for you to get out of debt. The only exception is secured debts, but the amount and rate of interest can be significantly reduced even for some of these.

Other types of consolidation plans don´t reduce the debt at all; at best, they only lower your interest rates with any unsecured creditors that choose to participate. You may end up with monthly payments you can´t afford.

7. Attorney Working for You: Your Chapter 13 attorney is legally and ethically obligated to represent your best interests and fight for your rights zealously.

Some other consolidation programs are scams; others are private entities controlled by creditors. Either way, no one is looking out for you.

8. Does NOT Put Other Types of Property in Jeopardy: With a Chapter 13 bankruptcy, you are not required to pledge any collateral.

With many other consolidation plans, such as home equity loans, you are required to risk losing your home and property if you can´t afford the payments.

9. Pays Your Most Important Bills First: Chapter 13 bankruptcy first pays off most secured loans (such as mortgage and vehicles), then taxes and co-signed debts, and finally unsecured debts.

Credit counseling repayment plans can´t prioritize car or home payments or delay payments to unsecured creditors without penalties.

10. Debts Are Eliminated if The Creditor Doesn´t File Proof of Claim: To be paid during the Chapter 13 consolidation, each creditor must file a proof of claim with the bankruptcy court. Often, not all of them do so. When you finish your Chapter 13 plan, all unfiled claims of unsecured creditors are eliminated.

With credit counseling repayment plans, you still owe 100% of the debt plus interest and fees to non-participating creditors. Whether or not you can afford to pay, they can continue harassing you.

Other debt consolidation ads make lots of promises, but only bankruptcy provides real solutions. Find out today how Chapter 13 can solve your financial problems.

The Law Office of Denvil F. Crowe P.L.L.C., designated as a Federal Debt Relief Agency by an act of Congress and the President of the United States, proudly assists consumers seeking relief under the United States Bankruptcy Code. If you need debt relief, I´m ready to help.

Understand your rights for debt consolidation, bankruptcy, and other stressful financial situations by contacting us at: (662) 844-7949 or (662) 842-HELP (4357).

Or visit our site: www.mybillsbills.com