Debt Negotiation: What Makes This a Better Option in Solving a Debt Crisis

The U.S. Bankruptcy Code offers businesses and individuals various legal means which will allow them rise up from overwhelming debts and regain stability in their financial future. These legal solutions include liquidation bankruptcy or reorganization bankruptcy.

Bankruptcy, per se, offers many advantages, such as:

  • the restructuring or reorganization of the debt payment scheme to make monthly payments more affordable;
  • the discharge of all unsecured debts (such as debts due to credit card use, medical bills, personal loans, etc.); or,
  • the liquidation of certain assets and properties to pay non-dischargeable debts (these are usually debts owed to the government).

There are different chapters in the U.S. Bankruptcy Code, each designed to address an individual’s or a firm’s specific financial situation. There is chapter 7 (which is liquidation bankruptcy), chapter 11 (or business reorganization), and chapter 13 (or business reorganization designed for sole proprietors).

In the year 2010 alone, the U.S. federal bankruptcy courts recorded the filing of more than 1.5 million personal bankruptcy cases. Millions of American individuals and hundreds of business firms (both small and giant firms) resort to bankruptcy due to the many advantages it offers. However, a good business lawyer would not immediately offer bankruptcy as the main solution to overwhelming debts. He/she will first discuss bankruptcy’s advantages and disadvantages, as well the benefits and detriments of other legal means, like debt negotiation.

As explained in the website of the Bradford Law Offices, PLLC, debt negotiation is a better option due to the more manageable payment plan that it offers. This is because debt negotiation:

  • Does not require a litigation process (which bankruptcy requires);
  • Offers debtors the choice of paying the debt through a single/lump sum payment or through more affordable monthly payments;
  • Frees a debtor from being harassed by debt collectors, as well as from lawsuits and any legal action that will result to the forced sale of his/her properties;
  • Reduces or defers interest payments, lengthens the time span of payment, and allows the consolidation of loan payments; and,
  • Reduces the amount of the loan to more than half its original sum.

It will require great negotiation skills and extensive financial expertise, however, to make debt negotiation effective and successful. And this is what the likes of Ryan Ruehle have been specially trained to deliver.


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