The moment somebody talks about debt settlement, people think that they will have to spend hundreds of dollars employing a settlement company to negotiate with their lenders. They hear horror stories of companies charging more than the actual amount owed.
Considering all this, they feel that employing an expert is a very expensive option as compared to declaring bankruptcy. There are many persons who opt for bankruptcy because they feel that the cost of recovering from their financial problem will be too heavy.
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The truth is that bankruptcy is actually more expensive as compared to settlement. What is more, there is no scope for any leniency when you opting for bankruptcy because you shall be dealing with the court.
The matters are very rigid and straitjacketed as far as the court is concerned. If you do not have the money to pay the court fees, then you cannot opt for bankruptcy until and unless you arrange for the same. On the other hand, a company will be prepared to make an exception in your case or offer installment facility or even become a lender of yours if you convince them that you intend to repay each and every cent you owe.
What are the expenses involved in bankruptcy? The first expense is the court fees. The moment you walk into the court, you will have to pay for its services. Of course, this amount is never very high. However, it is significantly high enough to make you worry.
The amount is usually determined as a percentage of the amount of bankruptcy involved. This means that if you are declaring a bankruptcy worth a $100,000, then you will have to pay a fixed percentage of that amount as court fees.
After you manage to pay the court fees, you will have to pay the fees of the attorney. The attorney is appointed by the court to complete all the formalities. You certainly will not have the option of contacting your lenders on your own. You cannot inform them that you have chosen bankruptcy.
This job will be done by the attorney and the process of liquidation of assets and settlement of liabilities will be completed by the court appointed executive. All this will cost you money. What if you do not have the money to opt for this solution?
You will have to either wait for the lenders to take matters in their own hands or you should get in touch with the settlement company to escape the ignominy of public embarrassment. The choice is yours.
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