Debt consolidation is better way to avoid bankruptcy

Filing Bankruptcy is very common in USA now a day. The rate of filing bankruptcy has also increased immensely in the last few years. And this is not a good sign for any economy. But now the question is how to avoid bankruptcy? This is a big question to many of us. There are many ways to avoid bankruptcy. Debt consolidation is one of the better ways by which you can avoid bankruptcy. Debt settlement is also popular.

But we need to know the program of debt consolidation well before going for it. Debt consolidation is a program by which all your unsecured debts will combine in a single monthly payment. The benefit of this program is that you don’t have to pay all your debts separately. So, you are not dealing with your creditors anymore, the debt consolidation company will now deal with all your creditors. You will pay to the consolidation company’s fund and they will pay to your creditors. Here another benefit for you is that you can avoid harassing calls from creditors and collection agencies.

Now you might have a question that, will it affect my credit score? The answer may be, your credit will be good as long as you pay your debts. But if you default then it will be bad. Debt consolidation program will not affect your credit. Debt settlement is better for those who are in serious problem and not even in a position to pay monthly payments. In debt settlement program your total debt will be reduced by around 50% and it is far better than filing bankruptcy. So avoid bankruptcy and try to get good credit with debt consolidation or settlement program.