How Does Chapter 13 Differ From A Private Consolidation Service?
In a Chapter 13 case, the bankruptcy court can provide relief to individuals that a private debt consolidation service cannot provide.
A Chapter 13 case can stop:
- Home foreclosures
- Lawsuits against you
- Wage and bank account garnishments
- Unsecured creditors (including credit cards, payday loans and tax debts) from assessing additional late fees, penalties and interest.
A Chapter 13 case can force your unsecured creditors to accept a Chapter 13 plan that only pays a portion of the debt and to discharge the unpaid portions of those debts. Private debt consolidation has none of these powers.