Bankruptcy Attorney For Waco, Texas
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Central Texas:254-304-7161

Overwhelmed by debt? You’ve probably heard of bankruptcy or credit counseling before, but perhaps you just weren’t sure what those terms meant or how they impacted your situation. Here’s what you should know about the differences between credit counseling and bankruptcy, and how you can get help overcoming significant debt and start over with a clean financial slate. 


Credit Counseling Defined  


Credit counseling is offered by both for-profit and nonprofit organizations, and it’s designed to help consumers pay down debt and learn how to manage their money in the future. Credit counseling agencies typically offer budgeting and general money management advice, but some may also offer housing or student loan counseling to individuals with mortgage or student loan debt. 


Bankruptcy Defined 


Bankruptcy helps consumers by providing a legal way to erase debt, either by discharging it entirely or repaying it over a period of time. The latter is a Chapter 13 bankruptcy, which is often used by consumers who earn too much to have their debts completely discharged. Their debts will be consolidated and paid back over a three to five year period. The former is a Chapter 7 bankruptcy; the consumer provides proof that they cannot pay back their debt and unsecured debts are discharged. Secured debts, like student loans, must be paid back even after a Chapter 7 bankruptcy. 


Which Should You Choose? 


Discussing your financial situation with a credit counselor can be a great option if you’re struggling a bit with keeping track of your money or you have a financial goal that you want to meet and you need help adjusting your budget. While credit counseling can give you some excellent information about how to improve your finances, you’ll still need to do all the heavy lifting. Bankruptcy, however, can help you either completely eliminate your debt now, or over a period of a few years. It also places an automatic stay on your collection accounts, which stops creditors from continuing to contact you while you’re going through the bankruptcy process. 


When Should You Call a Texas Bankruptcy Attorney? 


If you’re drowning in debt, you’re not alone. Many Americans are in the same boat as you, but that doesn’t mean it’s sinking any slower. Get the help you need to make sound financial decisions to get out of debt and start over with a clean financial slate by discussing your case with an experienced bankruptcy lawyer. Call Sims Bankruptcy Law, PLLC today for more information at (469) 751-7467. 


By : First Page Attorney | October 31, 2019 | Bankruptcy