Should You Consult Bankruptcy Lawyer Before Debt Settlement?
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If you’re struggling with overwhelming debt, you’re not alone. Many people in Maryland and beyond face the tough decision of how to regain control over their finances. When considering your options, two paths often come up: debt settlement and bankruptcy.
But should you consult a bankruptcy lawyer before diving into debt settlement?
Attorney Erica R. S. Hunt, being the best bankruptcy lawyer in Maryland, can tell you that consulting an experienced bankruptcy attorney before making this decision can save you time, money, and stress in the long run.
Let’s dive into why that is.
Debt settlement is when you negotiate with creditors to reduce the total amount of debt you owe. It sounds appealing, right? After all, who wouldn’t want to pay less than what they owe? But there’s a lot more to it than meets the eye.
Bankruptcy, on the other hand, is a legal process that helps individuals or businesses eliminate or restructure their debt under the protection of the federal court system.
Depending on the type of bankruptcy (Chapter 7 or Chapter 13), your debt may be forgiven, or you may enter a repayment plan. While both options can help relieve your financial burden, they work differently, and each comes with its own pros and cons.
Consulting with a bankruptcy lawyer first can help you fully understand your rights and which option best aligns with your financial goals.
Debt settlement may sound like an easy fix, but it comes with its risks. It can take years to successfully negotiate with creditors, and during that time, your credit score could plummet. Furthermore, many debt settlement companies charge high fees, and some even offer no guarantees.
On top of that, settling your debts means that creditors may not forgive all of your debt. They could decide to pursue legal action, garnish your wages, or take other aggressive steps to collect the remaining balance.
Also, the forgiven debt could be considered taxable income, leading to a potential tax bill down the line.
As a bankruptcy lawyer with over 30 years of experience in Maryland, I’ve helped countless clients navigate their debt relief options. By consulting with an attorney like myself, you can better understand whether bankruptcy might be a more effective option than debt settlement. Bankruptcy offers more protection than debt settlement.
Filing for bankruptcy automatically puts a stop to most creditor actions, including wage garnishment, lawsuits, and harassing phone calls. It also allows you to eliminate certain types of debt entirely, which could be more beneficial than attempting to negotiate a reduced amount.
An experienced bankruptcy lawyer will review your situation in detail, helping you weigh the pros and cons of each option. I’ll also help you assess whether you qualify for Chapter 7 (which may allow you to eliminate all unsecured debt) or if Chapter 13 (which involves a repayment plan) is a better choice.
While bankruptcy is often the more straightforward option, debt settlement could work for some individuals. However, even in cases where debt settlement might seem viable, it’s still wise to consult a bankruptcy lawyer first.
Many clients come to me after years of attempting debt settlement on their own, only to find themselves deeper in debt than when they started. Getting professional advice upfront can save you from making costly mistakes.
Navigating debt settlement or bankruptcy is no easy task. As a seasoned attorney at the Law Office of Erica R.S. Hunt, LLC, I’ve seen firsthand how important it is to have legal representation during such a challenging time.
Not only can a bankruptcy lawyer provide you with a clear understanding of the legal process, but they can also advocate on your behalf, ensuring you get the best possible outcome.
Reach out today to schedule a consultation and take the first step toward financial freedom with the best bankruptcy lawyer in Maryland.
