If you need to catch up on paying your bills in Massachusetts, a debt relief program may help. These programs are designed so that you save money in an escrow account. Then, once you have reached the minimum amount, workers with the program try to negotiate a smaller payment with your debtors. Some companies work quickly with debt relief programs, while others will not work with them at all.
Advantages of debt-relief programs
Debt-relief programs usually cost a percentage of the money you owe or the negotiated savings they save you. These programs allow you to pay off your debt in two-to-four years faster than many other options. Setting your obligations through a debt-relief program will hurt your credit, but it will not hurt it as much as declaring bankruptcy. It can stop debt collectors from constantly calling you and prevent creditors from suing you for unpaid balances.
Advantages of declaring consumer bankruptcy
Some consumers choose to declare bankruptcy instead of going through a debt-relief program. When you declare bankruptcy, you will need to pay a court fee. Depending on the type of consumer bankruptcy, your creditors may be unable to collect any money, but you may have to sell most of your processions to satisfy other creditors. Bankruptcy stays on your record for seven years. After that, your credit score will fall significantly, so it may be challenging to get other loans.
Debt-relief programs allow consumers to get caught up on their bills by putting money into an escrow account and negotiating with creditors to settle their accounts for less than they currently owe.