Debt Settlement Vs Bankruptcy: Choose The Right Option

Choosing between debt settlement and bankruptcy is a hard nut to crack when your debts are skyrocketing. However, it is significant to know that though both debt settlement and bankruptcy are there to help you get out of debt, they work in their own way and obviously have separate consequences. Therefore, it is very important to consider your options and the outcomes carefully before choosing one to get relief from your debt burden.

Know the Purposes of Debt Settlement and Bankruptcy

Bankruptcy and debt settlement more or less do the same thing. They help you get rid of your unsecured debts, such as personal loan or credit card debt. Both in bankruptcy and in debt settlement, you pay your creditors an amount less than you primarily owed.

Debt Settlement
In a debt settlement procedure, you come to an understanding with your creditors and pay an amount lower than the initial debt. The creditor, however, forgives the remaining amount. You either can hire a debt settlement company to do this for you or can also attempt to settle yourself. However, before choosing a debt settlement company, make sure it is legitimate by checking with the Better Business Bureau (BBB).

Personal Bankruptcy
Bankruptcy filing is a court procedure that you undertake in order to shed off your debts. In a personal bankruptcy, the court determines how you will pay off your creditors. If you file a chapter 7 bankruptcy, your all non-exempt property is sold and the liquid cash is distributed to the creditors. While in a chapter 13, the court designs a repayment plan. A debtor, having a steady source of income must repay the debts within 5 years.

Effects on your Credit Score
Engaging with a debt settlement program may or may not affect your credit score. If you make some late payments and/ or carrying high balances in your credit cards, you credit score may spoil. A successful debt settlement, however, can help you save thousands of dollars, avoid bankruptcy and become debt free within one or two years.

On the contrary, filing a bankruptcy stays on your credit report for up to 10 years from the date of discharge. During that time, if you reach out to a lender for a personal loan, he/ she may decline or charge higher interest rates because of the bankruptcy on your credit report.

In Conclusion

Considering all of these factors, it’s up to you decide which is right for you.

However, generally speaking, unless you are in serious debt with no way out, it is better to try debt restructuring before filing bankruptcy.

Schneier on Security

Schneier on Security

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Top Travel Scams

Vacations should be a time to relax, have fun with the family, and forget about all the stresses of work and normal every day life, unfortunately for some vacations and traveling bring about their own stresses. The amount of people who are being scammed when they travel is increasing at an alarming rate. If you are planning a vacation or will be traveling soon, make sure you are not scammed. Here are the most commons scams while traveling. Continue reading Top Travel Scams

PayPal Cyber Attack Arrests

Did you get the message?  I did.  Just a few days ago I received the a purported PayPal message that my account was going to have limited access, as well as several other terms and conditions that to be honest sent me into a PayPal rage. Should I have any questions I should use the link below to log into my PayPal account.  Sound familiar?

It was very convincing, however it was a weekend and I thought, “I’ll deal with it later.”  Monday I find that many other people I know received similar messages which of course caused us all to start wondering, “How real is this reality check on our PayPal account?”  It didn’t take long to find out it wasn’t real at all.

Allegedly hackers broke into the PayPal server in a retaliatory attack for WikiLeaks accounts being suspended.   Founded by Julian Assange, Wiki Leaks is an anti-secrecy organization that collects  information and then releases it to the public.  Their founder was arrested in Great Britian last winter after releasing 250,000 State Department documents in which US diplomats were, quite frankly less than complimentary towards their counterparts throughout the world.

(read more about WikiLeaks founder’s arrest)

The FBI reports the arrest of 14 people allegedly involved in the cyber-attack on PayPal.  Other arrests were made overseas in Great Britain and Amsterdam. Reportedly the cybberattacks on PayPal’s website were by the group “Anonymous.”  Anonymous is a group of hackers sympathetic to WikiLeaks and it has claimed responsibility for attacks against corporate and government websites worldwide.  PayPal closed the account being used for donations to WikiLeaks citing violations of the PayPal terms of service.  Wikileaks response was “PayPal’s action tried to economically strangle WikiLeaks.”

According to the indictment and complaints filed in court in San Jose, California, the defendants Continue reading PayPal Cyber Attack Arrests

Tax return fraud on the rise

Every year millions of U.S. citizens trust the IRS with all of their sensitive financial information when they file their tax returns. Unfortunately there are those out there who are looking to capitalize on the tax refund process by tricking unsuspecting citizens into releasing their private data.

Tax return fraud on the rise

The commissioner of the Internal Revenue Service told Congress that that the IRS has experienced a “significant increase in problems tied to the theft of taxpayer identities.”

In 2008, there were 51,702 incidents of fraud. In 2009 the IRS reported 169,087 cases of fraud, and in 2010, that number jumped to 245,000 cases. This is obviously becoming a major headache for the IRS. In fact the amount of cases has increased five fold in the last 5 years.

Commissioner Douglas Shulman also told the government accountability office that it is incredibly difficult to screen every return for fraud because it would cause massive delays, but Shulman has also said that the IRS obviously needs to do better.

How the fraud is taking place Continue reading Tax return fraud on the rise

How To Combat Debt Incurred Through Identity Theft?

Identity theft has always been deceptive, tough to spot and hinders the spread of technology.

Whenever you store more information online, the chances of identity theft increase as criminals get wider access to steal your private information. According to the Federal Trade Commission (FTC), each year nine million American’ identities are stolen, which results in $631 off out-of-pocket expenses for the victim.

Often, it takes years to realize that you are a victim of identity fraud and similar time to recover your credit worthiness. And often, victims of identity fraud/identity theft have debts that aren’t theirs, but they don’t know how to prove it.

As a result, victims use debt consolidation or bankruptcy to get out of the situation without knowing what they are (and/or are not) liable for any fraudulent debt resulting from identity theft.

Preventing and Detecting Identity Theft

Before you know how to get rid of your fraudulent debt without paying the same, you should know how to prevent identity theft first:

  • Always tear up your financial documents.
  • Sign the reverse of your credit cards immediately (or better yet, write SEE ID in the signature field and on the front of the card in magic marker), so that an aware clerk will at least think to check your ID.  This doesn’t always work, but sometimes helps.
  • Leave your social security number and card at home in a safe place.
  • Keep your personal information personal by only sharing it on an as-needed basis (may not help as there are many examples where trusted people are selling information).
  • Be careful of links in unsolicited emails.  There are multitudes of anti-fraud and anti-phishing toolbars and software.  Pick one and run it on your computer.  We like Spybot and AVG.
  • Use lengthy passwords that are hard to figure out. Substituting O for @ or s for $ is a good trick in a password.
  • Always report theft or loss of any identification material (passport, license, etc).  The value of this is that at least you have a police report to show that your information was lost/stolen.
  • Always scrutinize your bank or credit card statements carefully.

Obtain and review the free copy of you annual credit report. To order a free copy of your annual credit report, go to AnnualCreditReport.com or call toll-free to 877-322-8228. Otherwise, you can also contact other credit report vendors (like Equifax, Experian, or TransUnion).

Stopping Identity Theft and Fraudulent Debt

Once you realize that you have fallen victim to identity fraud, immediately file a “Fraud Alert” on your credit report and review your reports carefully. This will further help your creditors to take advanced security measures. If you file a fraud alert, you will also get a free copy of your credit report.

Once you have filed a fraud alert, you should do the following:

  • Request the consumer reporting companies to block fraudulent information.
  • Contact the security and fraud departments of the companies where an account was created without your awareness.
  • Send the companies copies of supporting documents, including the affidavit of identity theft.
  • Ask if the account has been resolved and fraudulent debts discharged.
  • Complaint in detail to the police.
  • Report the fraud to the FTC.

Fortunately, the FTC has a very useful “tools for victims” site, which provides directions, sample letters, and further a chart that you can print and fill out to know what you’ve done and what steps are still left.

IdentityTheftSecrets note:
This is a guest post, and as such is filled with a lot of re-hashed information we have covered on this site for the last 6 years.  However, a reminder is always a good thing.

SE Dummy Security Camera, Dome Shape, 1 Red Flashing Light

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Is APMEX secure to buy Silver Coins?

Anibal sent us an email with a question about Apmex:

Hi:
This is my first time to buy silver coins from APMEX.
I would like to know if APMEX is a true, secure, reliable company to buy those silver coins.
I did buy some silver coins from goldsilver.com and they send me coins. But their prices are a little more expensive than APMEX.
Please, help me.
Thank you so much.
Anibal

http://www.howtobuygoldx.com/apmex

——————–

Hi Anibal,

My experience with APMEX has been very good. I’ve talked with people from their company, and they even invited me to come to Oklahoma and see their vaults. I haven’t gone yet, but plan to sometime in 2011 or possibly early 2012.

The link below will take you through HowToBuyGoldX.com to Apmex. HowToBuyGoldX.com recommends buying silver and gold through Apmex as well.

http://www.howtobuygoldx.com/apmex

Hope that’s helpful for you! Please let me know how your experience goes with ordering from Apmex. Would be good to know your experience.

http://www.identitytheftsecrets.com/silver-bars-and-coins

10 Tech Secrets Kids Hide From Parents

After I write an article on my blog I try to find sites that might be interested in hearing about the article to see if they would be willing to share it with their followers. Accordingly, I recently wrote an article called ” 10 Technology Secrets Kids Keep from their Parents” located here:http://www.internetproviders.net/blog/2011/10-technology-secrets-kids-keep-from-their-parents/

It would be great if you could share this with others if you feel that it would be of interest to them especially those that follow your site.

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