How can I improve my credit without filing bankruptcy?
Many consumers attempt credit consolidation to pay off their debts without harming their credit. The basic idea behind credit consolidation is similar to a Chapter 13 bankruptcy for high-income earners: all the consumer’s debts go into a “payment plan.” This “plan” would be based on the amount left over between the consumer’s regular monthly income less expenses. However, unlike the legal bankruptcy protections of the Chapter 13 court-ordered plan, including a halt to accumulating interest and late payment penalties, credit consolidation is usually handled by private companies whose profit is based on their “commission” share of the payment transaction. Because these plans are based on private negotiations, there is also no guarantee of capping total balances owed.
