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Oakland, California is nestled along the San Francisco bay between some of the most exclusive and expensive enclaves in the world. Just a short drive from San Francisco, a short boat ride from Palo Alto and abutted by world-famous Berkeley, the city would seem to be ideally located for it’s residents to prosper.

Alas, if only things were so simple. Oakland has long been considered the underbelly of the San Francisco Bay Area. The city is one of the few in the country to have permanently lost an NFL team, a symbolic reminder of the city’s long, slow decline.

However, not all is gloomy in Oakland. Pockets of the city, especially downtown, have seen a recent influx of tech companies and startups fleeing the outrageous real estate prices across the bay. The city also has a thriving port, the fifth largest in the United States. This provides hundreds of thousands of jobs to area residents and drives billions of dollars in business in the surrounding areas.

But the city gets its somewhat dark reputation from its miles of ghettos, populated by economic discontents left out of the bay area’s prosperity. For many Oakland residents, especially minorities, the economic boom train has left them stranded on the station platform, with no boarding pass.

The City’s unemployment rate is exactly that of the state of California’s, at 5.5 percent. While housing costs are far lower than in the surrounding areas, which feature some of the steepest real estate prices in the country, that’s not necessarily good news. Many of Oakland’s home owners lost significant chunks of their net worth during the housing crisis and subsequent recession of 2008-2010. This has driven a high rate of bankruptcy in the city, consistent with California’s nation-leading number of annual bankruptcies.

For Oakland residents who find themselves mired in inescapable debt, bankruptcy is often the choice of last resort. But many of these residents who are faced with stark economic choices may be able to benefit from a different debt management strategy, debt settlement.

How can debt settlement help Oakland residents?

Debt settlement has one great feature, it can wipe away much of the principal amount owed. Since the elimination of the amount owed is the main goal of bankruptcy, that means debt settlement can often accomplish almost the same thing as a bankruptcy but without the horrible costs.

People who complete a debt settlement program can often see their debt loads instantly reduced by 50 percent or more. The key to getting such great results is to go with a proven settlement company that can show you a track record of negotiating great deals on behalf of its clients.

Some debt settlement companies operate nationwide and have tens of thousands of clients. This enables them to hold considerable sway over creditors, who may otherwise not be willing to take a settlement from an individual or lawyer. The reason for this is simply that large debt settlement companies can offer major creditors one-time, lump-sum payments on huge pools of non-performing debt. Whereas an individual might be able to offer a creditor a payment of $2,000 on a delinquent account, a debt settlement company may be able to offer them $2,000,000 to take non-performing loans off their books. This can be an irresistible temptation for many creditors, and it’s the reason why the best debt settlement companies can routinely get 50 percent or more of their clients’ debts eliminated with one stroke of the virtual pen.

The downside with debt settlement is that it usually involves the debtor taking a hit to their credit score. This can be as little as 50 points or as high as 150. But what’s certain is that it is far better than the damage done by going through a Chapter 7 bankruptcy.

Why not just declare Chapter 7?

If you plan on living a somewhat normal life, declaring Chapter 7 can be a major hurdle that blocks your path to financial success for years. The most serious consequence of going through bankruptcy is that you won’t be likely to get any loan, credit or short-term financing for at least seven to ten years. While this may not seem like a terrible consequence for some, for those with certain life goals, it may force their indefinite postponement. For example, if you are planning on forming a family in that time, it may become impossible to do so without the ability to acquire an adequate home. If you want to start a business, securing financing, both short-term and long, will likely be difficult or impossible. And you can forget about getting a credit card. The only card most issuers will offer recently bankrupt customers are prepaids.

But there are other problems with declaring bankruptcy that can be as bad or worse than the aforementioned. One problem is that many of the creditors to whom you legitimately owed tens thousands of dollars and who are now unable to collect, under the force of law, may be neighbors, coworkers and local civic leaders. This can have profound effects on your local career prospects and ability to form a part of the community where you live.