Debt Consolidation vs. Settlement
Legal & Financial Solutions in Queens
If you’re struggling with crushing debt, you may believe you only have two solutions: do your best to keep making payments or file bankruptcy. However, our attorney at the Law Office of Seni Popat may be able to find an alternative to bankruptcy that will substantially improve your financial circumstances.
Two of the most common options are debt consolidation and settlement or consolidating your debt in a Chapter 13 bankruptcy. With more than a decade of experience, our Queens bankruptcy attorney is fully equipped to help you understand their differences and determine whether either solution may be right for you.
Debt consolidation does not reduce what you owe. Instead, you will pay everything you owe with a new loan, thereby reducing your number of creditors.
A consolidation loan typically consists of one monthly payment to a debt consolidation company which in turn try to pay your creditors off with the monies received. Beware that many debt consolidations aren’t actually successful because the monthly payment is too low to actually pay your creditors the balance off in a given time period. Many clients come to our office after hiring a debt consolidation company and after many months of payments, clients typically still get sued by the creditors, have their wages garnished, and judgments obtained against them. We can explore whether a Chapter 13 debt consolidation can work for you.
While debt consolidation simply restructures your debt under a single creditor, debt settlement is a negotiated reduction of what you owe. When you hire our office, many creditors realize that if they do not settle with us, we may file bankruptcy for you and simply wipe the debt out. In many cases, creditors will only accept a settlement if you pay it in a lump sum (i.e. all at once). However, we may be able to negotiate a settlement plan and begin making modified monthly payments. Debt settlement is typically only an option for unsecured debt, such as credit card debt and medical bills. It will appear on your credit report, but it will not have as much of an impact as bankruptcy.
Creditors may be motivated to forgive a portion of what you owe if they believe bankruptcy is your only alternative. Our attorney can skillfully negotiate with your creditors on your behalf, utilizing his knowledge of their motivations to obtain the best possible arrangement for your situation.
Finding the Right Strategy for You
Both debt consolidation and settlement are methods of avoiding bankruptcy. While bankruptcy can substantially improve debtors’ financial situations, it isn’t right for everyone and often does not work for many people because they simply cannot pay the large amount of debt back. This is where the Law Office of Seni Popat comes in. Our Queens bankruptcy lawyer can carefully assess your circumstances, help you understand your options, and provide guidance and advocacy through every step of your debt-relief process.
I had the pleasure of working with Seni Popat. He is a Top Professional!- I Gie – via Google
Law Office of Seni Popat is the place to get help.- Willie Kornegay - via Google
He is very knowledgeable, professional, helpful and was readily available to guide me and advise me through the filing process.- James Potter - via Google
Seni was absolutely fantastic.- Nicole H. - via Google
Mr. Seni Popat is THE BEST bankruptcy lawyer there is.- Yasmeen Smith - via Google