What’s Better: Debt Consolidation or
Bankruptcy?
The short answer is debt consolidation, but this is a much
bigger question. The fact of the matter is that generally
speaking, it is always better to get the debt consolidation than
it is to get a bankruptcy. The loan will put all of your debt in
one place, and it will give you a lower interest rate so that
you can pay back your debts in a timely manner. However, you are
also looking at another loan, and if you are not responsible
enough you could be facing real repercussions from getting one.
The loan will clear off all of your debt, leaving you seemingly
debt free. But if you are not responsible enough you will run
those credit cards back up and give yourself double the debt
that you had before.
This is why it is important to keep your debt where it is if you
know that you are not going to be responsible enough to handle
the cleared off debt. But there are times that people get a debt
consolidation loan only to find out that they can’t pay it
anymore than they could pay the debt that they had before. Even
with a settlement, they are unable to make the payments on their
debt. This is a good example of when a bankruptcy is probably
needed as opposed to the guy who just gets it so that he does
not have to pay back his debts.
But a debt consolidation is also better than a bankruptcy
depending on your career choice. There are some jobs that if you
have a bankruptcy in your past that you cannot get the job – you
are disqualified from holding certain positions because of it.
This, again, is just something you need to consider when
deciding between the two.
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