Thursday 28 February 2013

What Are the Three Important Types of Bankruptcies in California?

Most of us understand bankruptcy to be a mechanism where a debtor makes a new financial start to repay the maximum extent possible to his or her creditors. However most of us lack knowledge of the minute details of bankruptcy under the laws in California. There are three major types of bankruptcies which have derived their names from the title of the chapter as mentioned in the American Bankruptcy Code. These are Chapter 7, Chapter 11 and Chapter 13. All these are meant to liquidate a debtor's asset and make payments to the creditors. Let us now take a closer look at these three different types of bankruptcy in California.

Chapter 7

This is the most common bankruptcy filing procedure in California. Under this a trustee will collect all your assets and liquidate them in order to pay back to the creditors. This allows you to make a 'fresh start' with all your debts. Most people opt for Chapter 7 so that they can benefit from exemptions such as homestead and vehicles. However, this exemption often depends on your debt and on the discretionary powers of the trustee appointed in your case. During the liquidation process the net proceeds of the liquidation are distributed to your creditors while the trustee charges you a small commission for overseeing the distribution. In most cases Chapter 7 usually lasts about four to six months. In the end most debts are extinguished through a discharge of debts. This bankruptcy chapter doesn't apply to debts such as alimony, child support, fraudulent debts, certain taxes, student loans etc for which other chapters need to be used.

Chapter 11

Chapter 11 of bankruptcy is designed for business-related bankruptcies. This chapter of bankruptcy is preferred by most businesses as one in which, instead of paying off debts, using a single liquidation allows a business to function without draining its creditors. This is the reason it is often referred to as the rehabilitative bankruptcy process. Under this you will remain in charge of your business and will have to work with a trustee and a debtor in possession and reorganize the business model to make it profitable again and pay off the debts. Some of the assets might be liquidated to make the business profitable. However, if you fail to implement the business recovery plan prepared by the trustee, you can liquidate the assets and pay back the creditors.

Chapter 13

This is another bankruptcy chapter which is available for individuals, though it is for a longer plan when put against the debt repayment plan, which works from three to five years. This chapter of bankruptcy protects your regular income and also other assets such as your house and your car. Here a court-appointed trustee will chalk out a repayment plan and once your repayments have been made under the plan your debts will be discharged. However, if your bankruptcy petition has been rejected in the last 180 days you aren't eligible for this chapter. Under this chapter you will be protected from the debt collectors and also wage garnishments, lawsuits and telephone collection calls.

Apart from these three types of bankruptcies in California there are other types of bankruptcy code such as Chapter 9, Chapter 12 and Chapter 15. However, these are used rarely and apply only to specific circumstances. For example, Chapter 9 defines municipal bankruptcy while Chapter 15 deals with international bankruptcy cases. If you are planning to file for bankruptcy under the California law it is important that you consult a bankruptcy attorney who shall guide you with the entire process.

Attorneyforbankruptcy.com is a leading law firm of California where you can hire most experienced san jose chapter 7 bankruptcy lawyer and get information on consumer debt consolidation.

Wednesday 27 February 2013

How To Judge The Right Tax Attorney For Your Case In California?

Taking care of your finances as well as keeping track of your taxes is very important. A tax attorney is the person who can help you maintain your finances and guide you in tax payments. The tax laws in California are complicated, technical and ever changing and without the help of a tax man it is difficult to understand the nuances of the law.

Who Are Tax Attorneys?

Tax attorneys have specialty in dealing with the minutest details of the IRS tax code. They can suitably guide laymen on various legal issues especially those pertaining with areas of trusts, tax disputes, estate planning, business tax laws etc.

Why Hire Tax Attorneys?

You may be wondering why you need a tax attorney when your local attorney is there to help you with matters. A tax attorney is required when you have issues related to tax that though can be handled by generalists but will be better managed and handled by specialists – in this case, tax attorneys.

When To Look For The Right Tax Attorneys?

There may be several reasons for you to search for a tax attorney in California. Considering the fact that the laws are quite strict in the state, it is essential that you get in touch with the right tax attorney who can help you come out of a tax fraud or any other problems with minimal scratches. Following are some of the instances when you would need a tax attorney:

  • You have just started a new business and need legal advice pertaining to the tax laws of California. You would also need consultation on how the tax laws of California affect your business.

  • You have knowingly or unknowingly committed a tax crime and are seeking judicial protection from an attorney.

  • You own an estate that is taxable and you need guidance on the tax treatment related to the estate.

  • You have engaged in international business and understand that there are legal issues that need to be addressed, especially on taxations.

  • You need to bring a suit against the IRS.

  • The IRS has issued a criminal investigation against you.

Qualifications Or Credentials To Look For In Tax Attorneys

The minimal qualification required to practice law in any state of the United States of America is to have a Juris Doctor (J.D) degree and to be formally inducted into the state bar. Additionally, when you are looking for attorneys having specialty in tax laws, you should look for professionals having advanced training on the subject. Ideally such people should have a Masters of Law degree in taxation.

There are other qualifications that you can look out for. If you have a complex legal problem, you should look out for attorneys who are also Certified Public Accountants (CPA).

Attorneys with CPA have experience in maintaining business and financial records. They help in preparing your tax records, ensuring that your business complies with the tax code and you are filing all your tax returns on specified dates. CPAs are also authorized to represent you in front of the IRS. Attorneys with CPA are also qualified to develop comprehensive tax strategies.

Tips While Choosing Tax Attorneys

When you decide on a tax attorney in California do not forget to check on his/her reputation. The attorney should have a good standing in the legal circle and should be well respected. However, be wary to be associated with a very busy attorney who may not give you the attention you seek and your case requires. Since we are talking about a long-term association, fix the consultation fees in the beginning.

This post is shared by Attorneyforbankruptcy.com, which a leading law firm of California. Here you can have detailed information on Tax Attorney San Jose and California Chapter 13 Bankruptcy Attorney.

Tuesday 26 February 2013

How Chapter 13 Bankruptcy is Helpful?

Chapter 7 and Chapter 13 are two common chapters one can use to file for bankruptcy. In Chapter 13 bankruptcy you do not have to forgo your property in order to pay off the debt. Apart from not involving liquidation, there are several advantages of Chapter 13 bankruptcy that makes it a good choice for debtors. Chapter 13 is more complicated than Chapter 7 and one needs to be understand it well before opting for it.

Eligibility

Everyone cannot apply for Chapter 13 bankruptcy. The first criterion to be able to choose this chapter is that you have to prove to the court that you have a steady income which makes it possible to repay the loan. You will also need to prove that you can meet all your financial obligations such as alimony payment, child support etc before you use your income to repay debt. The second criterion is that if you have a high debt you cannot use Chapter 13 to repay the debt.

Duration of the Repayment Plan

Chapter 13 enables you to repay the loan over a long period of time which can take about 3-5 years. However, the duration of the repayment plan will depend upon your income and your debt amount. You can easily find out whether you will have to file for three-year duration or five-year duration simply by finding out whether your average monthly income in the six months prior to filing bankruptcy is more or less than the median income for your state. If it is more, you will have to propose a five-year plan and if it is less than the median income, you can ask for three years.

Restrictions To Be Observed

There are many things which make Chapter 13 different from Chapter 7 bankruptcy – one being that a debtor cannot incur more debt without the approval of the court. For example, a debtor under Chapter 13 cannot acquire a car loan.

Amount To Be Repaid Under Chapter 13

Chapter 13 makes it mandatory for you to repay some debts completely. The debts which need to be repaid in full are called priority debts and can include alimony, child support, tax obligations and wages you owe to employees. Your Chapter 13 bankruptcy plan must also maker provision for you to repay your secured debts (debts which gives creditors the right to own your property or car. While planning for Chapter 13 bankruptcy, you will also have to consider repayment of unsecured debts such as credit card or medical bill. You will have to use your disposable income for repaying the unsecured debts. However, you can repay these debts over a period of time and need not necessarily pay all at one go.

Trustee in Chapter 13

For filing a Chapter 13 you will need a direct point of contact that is also known as a trustee. The trustee will review the payment plan and has the power to question the authenticity of the plan in the court if he finds things to be improper. Once the court approves the plan, the trustee becomes the intermediary between the debtor, the court and the creditors. The main job of the trustee is to take the payment from the debtor and use it to repay the creditor. The debtor cannot directly pay the creditor.

Once you pay all your debts over the specified period of time, all your debts are discharged. You will receive an official discharge notification once you show to the court that you have been regularly paying your alimony and child support.

Attorneyforbankruptcy.com is a leading law firm of California where you can hire most experienced california chapter 13 bankruptcy attorney and tax relief lawyers.

Sunday 24 February 2013

6 Simple steps to stop a Wage Garnishment in San Jose

Wage garnishment is one of the most preferred ways for creditors in San Jose to recover their debts. For this they have to obtain a favorable judgment from the courts which allows them to recover debts such as pay day loan, credit card dues, medical loans and personal loans. Creditors usually contact your employer and can garnish up to 25% of your wages. If your wage has been garnished in San Jose, there are many things you can do to avoid this. Here we shall take a look at six steps which will help you stop a wage garnishment in San Jose.

  1. Contact Creditors - The first step to stop wage garnishment is to try and get in touch with your creditors and work out an alternative payment plan rather than garnishing your wage. In most cases this might not work as the creditors would have lost faith in your will and means to repay. However some creditors are understanding and might give a patient hearing to you. It's always worth a try to negotiate a deal.
  2. Pay in Lump Sum - If you have some savings somewhere or can garner some cash in hand, it would be wise to pay back some of your dues to the creditors in lump sum. This will prevent your regular income from being garnished.
  3. File for Exemption - The next step to stop wage garnishment is to file for an exemption. If you can prove that your total income is needed to meet the basic necessities of your life you can seek an exemption from wage garnishment. Here you will need to fill your financial statement with a claim for exemption.
  4. File Bankruptcy - If you are not eligible for an exemption you can file for a bankruptcy which will put an automatic stay on your wage garnishment. You can file for a Chapter 7 or Chapter 13 bankruptcy to stop wage garnishment. This will prevent the creditors from engaging in collection activities against you. However you need to keep in mind that the stay doesn’t apply to payments such as spousal support and child support which can be garnished from your wage.
  5. Recover Garnished Wages - Yes you can also recover the garnished wages which have been garnished in the last 90 days prior to your filing for a bankruptcy. If more than $600 have been garnished in the last 90 days you can claim a refund. However if the amount is less than that your claims for recovery will not be entertained.
  6. Contact Attorney - All these steps can help you avoid wage garnishment but it is very important that you get in touch with an experienced attorney in San Jose who will help you stop wage garnishment in a methodical manner. Your case would be unique and the attorney will guide you in stopping wage garnishment based on your circumstances.

Don't waste time or make unforced errors in managing your debt. Contact an experienced attorney and get respite from wage garnishment.

This post is shared by Attorneyforbankruptcy.com, which a leading law firm of California. Here you can have detailed information on wage garnishment in california and debt consolidation in california.

Thursday 21 February 2013

How Do Lawyers Help in Debt Consolidation Cases in California?

Indebtedness takes away people's sleep and this isn't something which is very uncommon and you can see it happening all over US, especially California. Right from the professional lives to personal life and relationships, it takes a toll on everything in a very negative and stressful manner. When the management of multiple debts and never ending payments gets out of hand, completely losing it is not a great idea but to think sensibly is and this can be done by consulting foreclosure/mortgage lawyers who hold expertise in reducing debt consolidation by different methods and helping people choose an affordable debt consolidation plan. Let us see how the lawyers can help in debt consolidation.

Choose the Right Plan

A lawyer can help you in two ways. First is by helping you choose a debt consolidation plan which is a plan to help you in dealing with the mounted debt with a planned and a balanced manner and through this you can pay back your lender with the help of an understanding with the lender authority and save money. The second is a debt consolidation loan by which all your debts are added into one loan which is usually affordable and can be paid in monthly installments. A good lawyer will help you in deciding what is better for your situation and choose for you a plan which will work out well.

Legal Knowledge

Debt problems can be small as well as huge and all of them have legal implications attached to it. No matter what option you choose for consolidation, both of them require knowledge of the laws and the implications that will be caused if the process is not carried out in a constitutional or a legal manner and consulting a lawyer can help out greatly in this. Lawyers have the ability to guide you, study your case and choose the right and trusted consolidation agency for you and also help you through with the process by preparing the documents and residing in the meetings.

Negotiations

Getting your hand dirty in the legal issues without having any prior experience can really cost you and sometimes even lead to a greater debt to pay. This is why, letting a lawyer take charge and represent you in a more experienced way is a good idea. A good lawyer can be a very useful tool in dealing with the case of debt consolidation and can also help the borrower in communicating with the lender or the consolidation agency. They can also help the borrowers in buying some extra time in which the payments can be arranged and also help in deciding an affordable easy monthly payment which will make the job of paying the dues much easier. This is important as if you try and negotiate on your own, the agency might take advantage of your lack of experience and steal from you. Thus, professional legal advice will always be of help when dealing with such cases.

These are the few reasons why you can be benefited by the presence of a lawyer on your side. There are a number of lawyers in California holding expertise in debt consolidation cases and they are very easily able to sort out your problems. Another advantage that you have in having them on board is that most of them already know a number of debt consolidation agencies and have tie-ups with them, which further helps you as they can get you a much better deal due to previous good relations. This is why, no matter what, you must consult a lawyer in debt consolidation cases.

Contact Attorneyforbankruptcy.com to hire bankruptcy attorney san jose ca. Here you can have detailed information on tax attorney in california and dept consolidation san jose.

Tuesday 12 February 2013

Which Is A Better Option- Bankruptcy Or Debt Settlement?

Debt settlements and declaring bankruptcy are two common methods of dealing with lack of credit in your bank account. Basically debt settlement means hiring a debt settlement company to negotiate with the creditors the pending debt amount and reach a settlement which is much lower than the initially agreed percentage. On the other hand, individuals can declare bankruptcy in two ways - through Chapter 7 and Chapter 13.

Pros of Using Chapter 7 and Chapter 13

Chapter 7

For individuals facing a financial crunch, there are many benefits of filing for Chapter 7 and Chapter 13 bankruptcy. Using Chapter 7 bankruptcy much of your unsecured debts can be discharged. While most of your assets will be used by the courts to repay the creditors, you can start rebuilding your credit afresh. An attorney costs much less when filing for Chapter 7 as the case can be handled for as little as $500.

However, the disadvantages of Chapter 7 are many. To start with your credit record is badly affected and for a minimum of 10 years the bankruptcy is reflected in your account. During this period, it will be difficult to get a new job, apply for a loan, buy a house etc. Every asset that you own can be used to repay the creditors leaving you with almost nothing. Since most assets will be liquidated, this type of bankruptcy is also known as liquidation bankruptcy.

Chapter 13

Chapter 13 bankruptcy can be used to repay creditors over a 3-5 year time. Chapter 13 is also known as Wage earner's bankruptcy and can be used if you have an annual income that surpasses your basic needs such as food, shelter, payments of necessary bills etc. Using Chapter 13 lets you keep both your exempt and non-exempt properties while debts that could not be settled under Chapter 7 can be repaid using Chapter 13. Foreclosure can be delayed while the payment time can be extended.

The disadvantages of Chapter 13 are that the bankruptcy will be reflected into your credit report for 7 years. Getting more loans will be difficult and you will have to hold the string of your lifestyle really tight. Moreover not all debts can be discharged under Chapter 13.

Debt Settlement

In debt settlement, a third-party firm settles the terms of the debt repayment, many times reducing the percentage of interest to be paid. Hiring the right firm is crucial to making debt settlement work to your advantage.

It is true that you get to pay about half of your debt but the fact remains that without liquidating your assets you still have to repay over a period of time. Debt settlements cost more than bankruptcy and it takes about 24 to 48 months to pay off debts. Debt settlement is not a good option if your income doesn’t exceed your basic needs. It should be remembered that debt settlement companies change a substantial fees on processing your case and instead of helping you pay off creditors they can only add to your burden.

Attorneyforbankruptcy.com is a leading law firm of California where you can hire most experienced san jose chapter 7 bankruptcy lawyer and tax relief lawyers.

Monday 11 February 2013

What Are the Roles Defined by a Bankruptcy Trustee?

In bankruptcy cases a bankruptcy trustee is a court-appointed impartial officer who is charged with administering the debtor's estate. The trustee is appointed by the Department of Justice's United States Trustee and serves as a representative of creditors and protects their interests both in cases filed under Chapter 13 and Chapter 7. Thir role also involves Trustees are generally attorneys who have vast experience in bankruptcy laws. They have a varied role that includes collecting estate property, court appearances, objecting to discharge and objecting to exemptions claimed by a debtor. They are also charged with liquidating non-exempt estate property which can be distributed to the creditors. They role requires them to make sure that the debtor perform under the plan, and don't default on payments. Let us analyze their roles in Chapter 13 and Chapter 7 bankruptcy cases in detail.

Role of a Trustee in Chapter 13 Bankruptcy Cases

If the bankruptcy case has been filed under Chapter 17 the trustee's role involves reviewing and administering the reorganization plan that is submitted to the court by the debtor and verifying fairness and accuracy. Once the repayment plan has been submitted to the creditors the law allows them to challenge the plan at the Creditors' Meeting. This meeting is presided over by the trustee and not by the judge. During this meeting the trustee and the creditors questions the debtors under oath. The trustee notes down all the aspects of this meeting and forwards recommendations to the judge. These recommendations play a significant role during the judge's confirmation hearing where the repayment plan can be accepted or rejected. If the plan is accepted the debtor hands over the monthly payments to the trustee who distributes it to the creditors.

Role of a Trustee in Chapter 7 Bankruptcy Cases

When the bankruptcy case is filed under Chapter 7 the primary role of the trustee is to distribute the debtor's non-exempt property to creditors in accordance with the priority scheme of the Bankruptcy Code and administer the estate of bankruptcy. The role generally involves collecting assets, selling them, and distributing funds to creditors. In such cases the trustee has the duty to preserve sales proceeds until making payment on creditor claims. The trustee also reviews schedule of assets and liabilities of the debtor and also looks into the exemptions that may be requested by the debtor. The trustee also oversees the domestic support obligation of the debtor. The trustee also has to attend the Creditor's meeting and ensure that the bankruptcy case follows standard procedures as laid down by the law. The trustee also has the power deny the debtor the privilege of discharge if he or she finds evidence of evidence of perjury, fraud, malfeasance, or ineligibility under applicable statutes.

As a debtor who files a bankruptcy case you need to always keep in mind that the Trustee is assigned to look into the interest of the creditors. Thus you need to hire the services of a professional bankruptcy attorney who shall take care of your interests as these cases can be very stressful.

Attorneyforbankruptcy.com is a leading law firm of California where you can hire most experienced san jose chapter 7 bankruptcy lawyer and tax attorney san jose

Sunday 10 February 2013

What Are The Pros And Cons Of Debt Settlement?

There are many ways of dealing with debt in case you are unable to repay it within the time period decided upon. While declaring bankruptcy is one way of dealing with the situation, it has a long-lasting impact on your financial life. The other option that you can look upon is debt settlement. For negotiating a debt settlement, you will have to get in touch with a debt settlement company. A debt settlement company works as a third party who negotiates with the creditor on your behalf.

What is Debt Settlement?

Debt settlement means negotiating with the creditor to reduce the withstanding debt amount and pay the reduced amount at one go. Debt settlement works well both for the creditor and the debtor. Though the former forfeits the initially decided upon amount and settles for a lesser amount, he reduces the risk of not getting anything in case the debtor declares bankruptcy. The obvious benefit for the debtor is that he has to repay lesser amount to the creditor. It is important that the pros and cons are properly looked upon before reaching a decision.

Advantages of Debt Settlement

The reason why many debtors go for debt settlement is because creditors forfeit a large amount and accept a marginal percentage as repayment. If you have a good debt settlement company working for you, the creditor may forfeit as much as 70 per cent of the outstanding debt. However, getting such a good deal only happens when negotiations are done properly and to your advantage.

Since you settle all debts, you can start afresh and manage your monthly budget and other essential expenses better. Settlement also helps you plan your debt relief in measurable goals in such a manner that you can repay it within the prescribed time.

Disadvantages of Debt Settlement

If debt settlement is not properly negotiated, the disadvantages are more than the advantages. The biggest disadvantage of going for settlement is that it adversely reflects on your credit score. There is a vast difference between debt 'settled' and 'paid in full' and if the terms are not properly negotiated with the creditor, your credit score will be marred for a long time affecting your future investments.

The cost of engaging a third party firm is huge. While on the face it seems that you pay a reduced amount to the creditor, in reality you have to also pay the debt settlement firm which only adds to your expenses. Any firm will not carry on the negotiations on your behalf without charging an upfront fee from you. Additionally they will also charge you a monthly fee.

It takes anything between 24 to 48 months to settle all debts. During this period, you cannot directly pay your creditor. All payments will happen via the third party firm. Additionally debt settlement doesn't apply to unsecured loans such as car loans. Many states and many creditors prohibit third-party debt settlement too.

Thus before you decide on debt settlement, it is essential that you contact a legitimate company who has a reputation to boast off.

This post is shared by Attorneyforbankruptcy.com, which a leading law firm of California. Here you can have detailed information on wage garnishment california law and consumer debt consolidation.

Friday 8 February 2013

What Are the Consequences Faced If My Co-signor Files Bankruptcy?

Bankruptcy laws are complicated and the interpretation and intervention of the law varies from case to case. In case the loan has co-signatories where one decides to file bankruptcy might affect the others. Most people often fail to understand the application of law in such cases. No wonder bankruptcy lawyers are bombarded with questions surrounding a co-signer filing bankruptcy and its impact on other debtors. In this write-up we shall try and understand the consequences on the debtors when one of the co-signers files a bankruptcy.

The Basics

In a co-signed debt each of the signatories are 100% responsible for payment of debt. The creditors are authorized to legally collect dues from one or all the co-signers till the debt is cleared. In other words a cosigner filing bankruptcy has little impact on others. The good news is that default on part of one debtor doesn’t not trigger default or accelerate loan payments for the other borrowers. It also doesn’t affect the credit ratings of others who signed the loan, as long as they don’t default on the payments.

You Might Benefit Automatic Stay

If bankruptcy has been filed under Chapter 13 the court issues injunction against all creditors barring them from making any collection attempts. This say applies to all the co-signers along with the person who has filed bankruptcy. However if your co-signers chooses to file the bankruptcy case under Chapter 7 you get no such immunity and the creditors can continue to collect their dues from you.

Increased Collateral

One of the major areas of concern is when you have taken a secured loan. In such cases your lender might ask you for more collateral to secure the loan in case your co-signer has filed for a bankruptcy. This applies in cases where the collateral belongs to you and not to your bankrupt co-signer. However you need to keep in mind that if the collateral is held jointly it isn’t protected by a Chapter 7 or Chapter 13 of the bankruptcy law. In such cases the person filing bankruptcy can decide whether he or she intends to keep interest in the property or surrender it. In case the person opts to surrender interest the creditors can legally repossess the property under the bankruptcy law.

What Happens With Discharge?

Many people believe that ‘discharge’ in a bankruptcy case erases the debt. It isn’t so, as discharge makes the debt legally unenforceable against the person who had filed for bankruptcy. This waiver is applicable only to the person filing bankruptcy and not to his or her co-signors. The creditor can proceed to recover 100% of the debt from the remaining non-discharged signers.

Things to Remember
  • The law prohibits you from suing your co-signers once he or she has been discharged by a bankruptcy court.

  • Co-signed debts such as student’s loan and taxes are exempted from being discharged when bankruptcy is filed.

It is advisable that you seek legal help when one of your co-signers has filed for bankruptcy. A attorney will explain to you the nuances of the bankruptcy law applicable in your case.

Attorneyforbankruptcy.com is a leading law firm of California where you can hire most experienced san jose chapter 7 bankruptcy lawyer and tax relief lawyers.

Monday 4 February 2013

How to go steer Clear of a Debt Consolidation Method?

The financial crisis of the past few years have left many Americans dead broke. The situation has been compounded by the fact the Americans by nature love to spend be it on eating out or shopping for new gadgets. With freeze or pay hikes and even job cuts many Americans have fallen into the horrible debt trap. Interestingly a sizable number of people who are in debt comprise of people under the age of 30 who are full of aspirations and have a long life ahead of them. Most of them make use of plastic money and often fail to realize the rising mountain of debt over their head.

There isn't any textbook solution to managing debts and to start with you need to cut down on your personal expanses especially ones purely spent on leisure. This leaves you with more money to pay off debts and also eliminates the chances increasing debts. This might work if you have small amounts of money to pay back but most often people land up in situations where they have debt from multiple sources. What hurts you most in such cases is not debt alone but the high rate of interest which makes the debt amount grow exponentially and force you into a financial bondage. In such situations most people look towards 'Debt Consolidation' to get rid of their woes.

Debt Consolidation is nothing but a method under where you take a large loan to payback other debts. Under this process your consolidate your debts into one payment cycle at more favourable interest rates instead of having to pay multiple creditors at different interest rates and in different payment cycles. But this method of managing your debt does have its own share of pros and cons which we shall take a look at.

PROS
  • The interest rates of consolidated programs are lesser than those charged by your creditors. This reduces the amount of money you payback as interests.

  • Debt consolidation programs negotiate with your creditors which relieves your of telephone calls and agents who can take peace out of your lives.

  • It reduces the monthly payments which can put less stress on your personal expenses and manage a good living.

CONS
  • The biggest con of debt consolidation programs is the fact that it will decrease your credit score. Getting unsecured loans and applying for new credit cards might become difficult.

  • If you creditors are charging you variable rates of interest you might be on the losing side with debt consolidation programs which charge your fixed rates of interest.

So you need to make a decision based considering all the pros and cons. Make sure you choose a good debt consolidation program with a reputed firm and study their terms and conditions in detail. There are cases where debt consolidation programs give your more trauma that paying off creditors normally. Choice of bad program can hurt your credit score badly. So it is advisable that you consult a financial expert before opting for such a program.

Contact Attorneyforbankruptcy.com to hire bankruptcy attorney san jose ca. Here you can have detailed information on tax attorney in california and dept consolidation san jose.