Difference between Debt Settlement, Debt Consolidation, and Bankruptcy

Confused about the difference between Debt Settlement, Debt Consolidation, and Bankruptcy?

Check out this chart:

Debt Settlement Debt Consolidation
How much is the Consultation? Free Free
How do you know I owe the debt? We conduct a liability assessment for every account. They don’t know, and they don’t check.
What happens if I get sued? We can help you avoid judgment with negotiation They usually advise you to do nothing, which means you get a default judgment
How much do I pay the debt collectors? We negotiate to pay less than the full balance.  Usually between 30 – 60% of the debt. Full balance. But they temporarily reduce your interest rate and monthly payments
Do I receive proof that I paid the debt? We obtain written Settlement Offers and Paid in Full/Fully Satisfied Letters. No
What about my tax liability? We can help with a 1099-C Insolvency Assessment and coordinate with your tax prepare They do not address it.
What happens to my credit? Once paid, we help update your credit report to improve your credit score. Your credit score usually decreases, a lot.
How long does it take? Depends on you, but we aim for 90 days. 1 to 3 years
How much does it cost? Flat rate 15 to 20% of the debt paid in monthly installments


Difference between Debt Settlement, Debt Consolidation, and Bankruptcy
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My firm has 3 goals – be cost effective & efficient, make complicated things simple, and change the way people think about attorneys. We do this by offering flat rates with payment plans, educating our clients, and by encouraging everyone to ask us questions to better understand what we do & why we do it. I am a credit attorney and I love helping people with debt and credit legal issues.

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