With many people across America looking for ways to get rid of excess debt and find effective debt relief strategies that fit their needs, it is no wonder many people end up opting to take out a home equity loan to cover their debts. A home equity loan is essentially a second mortgage that you can get if you use your home as collateral. Equity is basically the excess value of your home than what you paid for. Over time, homes can appreciate in value, meaning if you paid $300,000 for your home 5 years ago, it may be worth $375,000 today. Your home equity loan would then be that $75,000 difference that you would need to pay over time, with a fixed interest rate. While this can be effective for some, it can be incredibly risky to put your home up as collateral. If you are unable to repay the loan you took out against your house, you may ultimately end up losing it. Contact a bankruptcy lawyer today to talk through which option may end up being best for you.
Is a Home Equity Loan More Effective Than Filing For Bankruptcy?
Although a home equity loan can provide you with immediate debt relief from a sudden debt that has sprung up, it can be incredibly risky because your house may be at stake. On the flip side, filing for Chapter 7 bankruptcy can put your home in jeopardy as well. However, with many other benefits such as getting most of your debts discharged and getting an automatic stay for immediate debt relief, bankruptcy can be a much more effective choice for you. It may be best to consult with our law firm to see if bankruptcy is right for you.
Which Method of Debt Relief Works Best for Others?
It can be difficult to gauge the success of either option of debt relief when comparing it to others. Not many people have the exact same financial situation as you so it can be difficult to make an assessment based on your own needs. There are merits and drawbacks to both sides which can make it difficult to choose from. However, by consulting with a bankruptcy lawyer, you can make sure you understand the pros and cons of both sides before making a decision.
How Can a Lawyer Assist Me With My Debt Relief Options?
Getting critical and pertinent advice about your options can be a significant help towards your financial recovery. Before making any decisions, reach out to our law firm to get the advice you need to make an informed decision about your future. Call us at the Holland Law Office today at 970-232-3097 for a free consultation.