Ignore what you see on television ads, hear on the radio or advice from your next door neighbor.  The aim of this article is to clear up some common misconceptions regarding bankruptcy alternatives.  First, there is Debt Management.  Debt Management programs are a form of consolidation of your existing unsecured obligations into one payment, usually at a lower rate, for an extended term.   You send one monthly payment, for a pre-negotiated amount to a not-for-profit, North Carolina LICENSED debt management company, who then distributes payments each month to your creditors in the program until your debts are paid off.

Debt Settlement is the process which in North Carolina, only a NC licensed lawyer or not for profit consumer credit counseling company licensed in this state may perform.  Debt Settlement involves contacting each of your creditors and negotiating reduced payoff balances, either in a lump sum payment or in a series of payments to settle your account in full.  Dont confuse this with debt management… Debt settlement will, in fact, negatively impact your credit, and is a final effort to prevent bankruptcy as an alternative solution.

It is important that you contact a qualified, North Carolina licensed attorney familiar with bankruptcy to advise you as to whether management, settlement, or bankruptcy is the best option in your particular circumstance. Financial hardship can get worse if you fall victim to one of the many unscrupulous and illegal scams out there.

About the Author: Joseph M. Bochicchio, PLLC., is a licensed Charlotte, NC Bankruptcy Lawyer with nearly 2 decades of experience in finance and law. His Charlotte Debt Settlement Law Firm is committed to providing legal and ethical guidance for North Carolinians facing financial hardship.

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