Florida residents may want to try other methods of dealing with insurmountable debt before resorting to bankruptcy. This includes debt consolidation and debt settlement. Many of these methods can be effective. However, it is important to know which debt consolidation or settlement methods are reputable and likely to succeed, and which can create more problems that you would expect.
As NerdWallet explains, debt consolidation is a process of grouping all your debt together that you control. You may, for example, obtain a consolidation loan or consult with a nonprofit credit counseling agency, which can help you satisfy your creditors and repay the loan with one manageable payment.
On the other hand, some debt settlement companies market themselves as consolidation agencies, and their tactics may cause more harm in the long term. Many of these companies charge significant, unnecessary service fees, as well as additional maintenance charges.
You may end up with interest and late fees from your creditors during the debt settlement process. Or perhaps the company fails to successfully settle your debts. This type of outcome is devastating news. Working with an ineffective debt settlement company does not guarantee success, and your credit is likely to be negatively impacted during the process.
Our page on debt consolidation versus bankruptcy further explains your options for addressing unmanageable debt. It is important to be educated on your debt relief choices, including debt consolidation, settlement and personal bankruptcy. You may find that a bankruptcy offers you advantages over an uncertain debt settlement offer.