New Bankruptcy Laws - How New Laws For Bankruptcy Make Debt Settlement A Better Option

Online, September 27, 2010 (Newswire.com) - New bankruptcy laws have made the process of filing for Ch. 7 bankruptcy much more difficult to qualify for. Filing for bankruptcy used to be the easiest option to eliminate debt and get a new financial start. With these new laws however other debt relief options such as debt settlement have become much more financially attractive.

Ch. 7 bankruptcy used to be the easiest way out of debt. With these new laws however it is much more difficult to qualify for Ch. 7. Consumers are much more likely to qualify for Ch. 13 bankruptcy which is not nearly as advantageous. Ch. 13 bankruptcy reorganizes the debts and comes up with a payment plan to pay that debt back over a period of 4-9 years.

Ch. 13 bankruptcy is similar to a debt settlement process however it will damage your credit rating much worse. Bankruptcy will stay on your credit for at least 7 years after the process is complete. With the average bankruptcy case taking 3-4 years this means that consumers can expect their credit rating to be negatively affected for at least 10 years. With debt settlement, many consumers are able to repair their credit within 3 years.

Debt settlement has seen a significant growth in cases over the past years which is a direct result of these new bankruptcy laws. Consumers who are experiencing a legitimate financial hardship and don't want to file bankruptcy see debt settlement a legitimate option for debt relief. The average debt settlement in 2009 was negotiated for 50% of the debt balance. This means that consumers are able to eliminate up to 50% of their unsecured debt while creditors are able to collect on delinquent accounts that would have taking a complete loss if the consumer were to file bankruptcy.

The easiest way to locate legitimate debt settlement companies is to use a Free Debt Relief Network . These networks will ensure that the debt settlement company you are provided is legitimate and is a respected member of all the regulatory commissions such as The Association Of Settlement Companies and the BBB. Most free debt relief networks will provide a free debt consultation to help the consumer determine what debt relief option is most appropriate. There is no magic bullet to get out of debt however debt settlement can a good option for consumers who are experiencing financial hardship and have at least $10k in unsecured debts.

To locate legitimate debt settlement companies through a free debt relief network check out the following link:

Free Debt Relief Advice