What Are The Advantages And Disadvantages Of Bankruptcy?

So does a bankruptcy stay on your credit report longer than a settlement? I have accounts in collections and am considering both options.

It depends. A settlement stays on your credit report for 7 years from the date the account was settled. Chapter 13 bankruptcy also stays on your credit report for 7 years, while Chapter 7 bankruptcy stays on your credit report for 10 years.

Keep in mind- both Chapter 7 and Chapter 13 bankruptcy stay on your public records for 20 years, whereas a settlement does not appear on your public records at all.

Advantages and disadvantages of bankruptcy:

One disadvantage of  Chapter 13 bankruptcy is that for 3-5 years your salary and financial activities are like under probation. The whole repayment period, at some point, may feel like being in detention all over again. Another disadvantage of bankruptcy is you really have to be careful with your financial activities, any changes in your financial status must be reported to the trustee of your case if you don't want your case dismissed.

The advantage of bankruptcy is, if the reason why you filed in the first place is ignorance with regards to managing your finances, going through bankruptcy would make you  more aware of your money's worth--and in a Chapter 13, you'd be trained to keep a budget. You don't have a choice, you'd just learn.

Advantages of Chapter 13 bankruptcy:

-Automatic stay provision
-The consumers get to keep their real estate and personal property
-Chance to discharge debts that are nondischargeable under other Chapters( ex. fraud judgments)

One advantage of Chapter 13 bankruptcy is also having to pay ypur debts back in a three-to-five year period, similar to a debt consolidation process...but on the other hand I think one drawback to bankruptcy is that you'll be having to deal with having that notation on your credit report for quite a long time as mentioned by the others earlier...