There are numerous scenarios in which an individual in Ohio or elsewhere may begin to experience financial struggles. There may also be a multitude of avenues with which a person can seek relief from debts, each of which may offer its own potential advantages and disadvantages. However, certain outlets for relief might not be as good as they seem, and bankruptcy could prove a better path with which to pursue financial freedom.
Upon exploring relief from debts, settlement offers may appear exceedingly enticing, especially at first glance. However, these arrangements could have certain disadvantages that may be easily overlooked, such as those pertaining to taxes assessed on any amounts that are forgiven in the process. The amount agreed upon in a settlement offer could also be deceiving, as this process could take numerous years to finalize, and interest rates and fees could leave a person paying nearly the full amount of original debt owed.
A settlement offer may also do little to protect a person from collection attempts, and the phone calls and letters may continue to arrive daily. However, with bankruptcy, a person could obtain protection against such attempts via the automatic stay. Although a bankruptcy will have an impact on a person's credit, a settlement agreement could have a similar result, or worse. By filing for bankruptcy, one could obtain immediate relief from debts and begin rebuilding his or her credit shortly after the process is finalized.
Individuals who are suffering due to substantial amounts of debt may find it advisable to seek guidance before deciding on a path. By speaking with a bankruptcy attorney, a person could obtain guidance on the options available, as well as their potential outcomes. An attorney in Ohio can thoroughly evaluate a client's financial situation and provide advice in choosing the correct path with which to pursue relief from debts.
Source: nerdwallet.com, "Debt Settlement Usually a Bad Alternative to Bankruptcy", Liz Weston, Accessed on Jan. 10, 2018