Chapter 13 is a section of the Bankruptcy Code which helps qualified individuals, or small proprietary business owners, who desire to repay their creditors but are in financial difficulty. Chapter 13 Bankruptcy protects individuals from the collection efforts of creditors; permits individuals to keep their real estate and personal property; and provides individuals the opportunity to repay their debts through reduced payments. Another benefit is that the time your Chapter 13 bankruptcy shows on your credit report is less, so it takes less time to rebuild your credit. Debt settlements clients are generally have superior income and some savings available to settle their debts with. If you earn below the medium income for your state, chances are, you do not have enough money to be a possible debt settlement client. So this is where you move towards Chapter 13 bankruptcy versus debt settlement.
In a Chapter 13, you have Court control, whereas in a debt settlement program the consumer are the one who control. In chapter 13, the Court forces a payment plan on your creditors which they must accept once your plan is confirmed. In a debt settlement plan, the creditors continue their debt collection efforts and you may be sued by any number of your creditors. Debt settlement is the fastest and better for the long term effect on your credit. For however long you need to take for this settlement program, you must make it your number 1st matter the more time goes on the more likely you are to get sued. Usually even if you receive a command it can be settled before the date and the court date will be canceled.