If dealing with bills and creditors has become overwhelming, you may be wondering whether debt consolidation or bankruptcy would be the better way to get you out of debt. The answer is complex and depends on your individual situation and factors such as your income, employment, assets, and whether you own a home.
Both bankruptcy and debt consolidation have benefits and disadvantages. Before you choose, you should be aware of the process involved and the long-term effects of each.
The skilled and seasoned Ohio debt-relief attorneys at Fesenmyer Cousino Weinzimmer understand that financial problems can happen to even the most well-intentioned people. We offer a free consultation to evaluate your entire financial situation – your income, your debts and your goals — and see what solutions are right for you.
Debt consolidation involves taking out a new loan to pay off several older debts. The idea is to have a lower interest rate and longer period to pay off the new debt than you had for the old ones. You start by contacting a debt consolidation service, which becomes the middleman between you and your creditors and negotiates reduced payments.
Once your consolidation is set up, you make one monthly payment to the consolidation company and they pay your creditors, so you no longer have to deal with them. You can consolidate debt through a secured loan (usually secured by equity in your home) or an unsecured loan, where the consolidator simply lends you the money.
You may also be able to lower your cost of credit by consolidating your debt through a second mortgage or a home equity line of credit. However, if you default, you put your home at risk if you have more equity in your home than you are allowed to protect with your Ohio home exemption.
Bankruptcy allows you to eliminate or restructure certain debts while under the protection of the federal bankruptcy court. The most common types are Chapter 7 and Chapter 13.
A Chapter 7 bankruptcy allows you to eliminate many types of debt quickly and receive a fresh start.
A Chapter 13 bankruptcy allows you to reorganize assets and consolidate your payments to avoid fees and fines and repay some or all of your debt affordably over a three- to five-year period. If you successfully complete the court-approved payment plan, the debts covered by the plan are discharged.
The experienced and compassionate Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer; know what it is like to struggle with financial problems and will help you find a solution. Take the first step toward debt relief and CONTACT US TODAY FOR A FREE INITIAL CONSULTATION.
During your consultation, we will evaluate your entire financial situation and determine whether bankruptcy or debt consolidation is the best fit for you. We will make sure you are aware of all your options and will walk you through the process.
Delaying can only worsen your situation, so call the Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer today! Call one of our conveniently located office branches at 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati) or email for your free consultation so we can determine what debt relief solutions will work best for you.
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