If you’re facing serious challenges in paying your bills, and debt collectors are calling and harassing or threatening you, then you may find yourself considering either debt consolidation or filing for bankruptcy. The two options both sound appealing, and the advertisements on radio and television for debt consolidation make it sound easy, and less embarrassing then bankruptcy, but the truth is that when things are really bad, bankruptcy is the most powerful and only real solution that works to your advantage. Let’s look at the reasons why.

First, let’s look at debt settlement. In most cases, debt settlement companies charge fees for their services – and then those services end up not being very effective. Their general methodology starts with instructing you not to pay your bills at all in hopes that your creditors will get frustrated and offer a settlement option. Not only do creditors rarely make these kinds of offers, but in following these instructions you add another month or two of missed payments to your record, and damage your credit history further. There have been many occasions when panicked clients have engaged my services after having made this mistake and now facing having their wages garnished or levies placed on their bank accounts.

Another problem can arise if a settlement offer is actually proffered by the creditor and you pay them some money, but then fall behind again and are forced into filing for bankruptcy. One of the first questions that the trustee will ask is whether any settlement or monies have been paid prior to the filing, and when the answer is yes it presents additional problems, as the trustee may opt for establishing that creditor as owed preferential payment.

In the face of mounting bills that you’re simply unable to pay, personal bankruptcy is generally your most powerful, most sensible option. Though there are definitely downsides, including having the bankruptcy filing appear on your credit history for several years, it is the single most effective method available to you for wiping out your debt and giving yourself the opportunity to make a fresh start of it.

By working with an experienced South Jersey bankruptcy attorney from Reinherz Law, you give yourself a chance to carefully assess your personal situation and choose what type of bankruptcy makes the most sense for you. You will be able to put a stop to the harassing phone calls and stress and to rebuild your credit over time, while still maintaining ownership over many of the assets that are most important to you.

For a better understanding of what filing for bankruptcy would mean for you, contact the law offices of Reinherz Law today to set up an appointment. We will sit down and explain all of the advantages and disadvantages so that you can make a well-informed decision.