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Allentown, PA Debt Consolidation Attorney + Services

Consolidating debt can help those struggling in Allentown manage debt and improve their financial health.

Generally, you can only consolidate certain debts in Allentown. For example, you can get a debt consolidation loan that combines credit card, medical, student loan, or personal loan debt. You would repay previous creditors using this loan and pay the new lender moving forward. On top of consolidating debts, we may negotiate lower interest rates or other repayment terms that suit your situation. Debt consolidation can have many benefits for debtors, like simplifying repayment and resulting in manageable monthly payments. That said, debt consolidation is not always the answer to all predicaments. When that is the case, entering into bankruptcy could be the best solution for struggling debtors in Allentown.

Call the team at Young, Marr, Mallis & Associates now at (215) 701-6519 to get a free case review from our Allentown, PA debt consolidation attorneys.

Debts You Can Consolidate in Allentown, PA

You can consolidate various types of debt to avoid further financial distress. These include credit card debt, medical debt, and unsecured personal loan debt, among others.

Debtors with considerable credit card debt can open a new line of credit with preferable terms to pay off their debts. They can also obtain debt consolidation loans, which is more common. By doing this, they will use the loan to repay other creditors. You will then have to repay the new lender that gave you the debt consolidation loan. That said, our attorneys can help you negotiate favorable terms to repay this new lender without falling further into debt.

You could also use a debt consolidation loan to handle student loans and high-interest personal loan debt. Our debt consolidation attorneys can review your total debt and financial situation as a whole to determine if this path is best for you.

Debt Consolidation vs. Debt Settlement in Allentown, PA

Debt consolidation and debt settlement are two different financial strategies debtors can explore when facing economic stress. Understanding the difference between these two strategies could be important for successful debt management.

First and foremost, debt consolidation involves combining debts so that debtors have fewer creditors. You could get a debt consolidation loan with a lower interest rate and an extended repaying period. Comparatively, debt settlement involves negotiating with creditors to reduce the amount you owe them.

For example, depending on the type of debt you have and a creditor’s willingness to settle, we may be able to negotiate lower interest rates, get creditors to waive fees associated with delinquency, and convince creditors to reduce the total amount you have to repay.

Debt consolidation and debt settlement might impact debtors’ credit scores differently. For example, although debt consolidation might lower a debtor’s credit score for a short time because of the hard inquiry involved in getting a loan, debt settlement might significantly affect credit.

The Pros of Debt Consolidation in Allentown, PA

Like anything, there are pros and cons to debt consolidation in Allentown. Our attorneys can carefully assess your specific situation to determine whether moving forward with debt consolidation is right for you.

For example, consolidating debt can simplify repayment. Instead of making multiple payments to multiple creditors, you could focus on making one regular payment to one lender. Furthermore, when debtors obtain debt consolidation loans, our attorneys can secure fixed interest rates and terms according to their financial means.

As you consistently pay off your debt consolidation loan, you can make efforts toward improving your credit. Furthermore, since your monthly payments should be within your financial ability, you can free up cash flow, allowing you to save and better manage your finances to avoid getting into debt again.

Although debt consolidation can help you simplify and manage repayment, there are certain drawbacks to consider. For example, suppose you miss payments for your loan. In that case, you could fall further into debt. Furthermore, debt consolidation is only suitable for some types of debt.

Moreover, debt consolidation is a complex process, so debtors should be mindful when seeking services in Allentown. While our attorneys can operate with your needs and interests in mind, debt consolidation companies might fail to negotiate a fair and appropriate agreement on your behalf.

What if Debt Consolidation Will Not Work for You in Allentown, PA?

If, after reviewing your case, our lawyers think another option suits your situation, we might advise you to proceed with a bankruptcy filing in Allentown.

Some debtors might not get approved for debt consolidation loans because of low credit. Furthermore, if you are struggling with overwhelming debt you cannot feasibly repay, you could benefit more from getting a debt discharge during bankruptcy. This could alleviate your responsibility to repay certain unsecured debts like credit card debt and other debts not backed by collateral.

If a debtor’s income is lower than the average, they will likely file Chapter 7 bankruptcy in Allentown, which involves liquidating a debtor’s assets. In light of this, it is important to make a plan to protect certain assets from liquidation, like your home. While Pennsylvania does not have a homestead exemption for Chapter 7, we might be able to use other means of protecting your home during bankruptcy.

If your income suits Chapter 13, our attorneys can consolidate debts via a repayment plan. This plan will consider your income, expenses, dependents, debts, and other financial details. The result should be a repayment plan that suits you and your creditors alike. Depending on your debt’s size and your specific financial ability, your repayment plan might take three to five years to complete in Allentown.

Once your bankruptcy case ends, you should be free from all debt. Because of this, bankruptcy could be preferable over debt consolidation for some debtors.