Debt Relief Services and Solutions - Learn The Options
Debt Settlement With this approach, negotiations are made with a credit card company in efforts to reduce the total amount of debt owed. With this forceful method of credit card debt relief there are many important advantages. Many consumers are able to significantly lower the total amount owed while paying off debt in 12-36 months. Making only minimum payments is not an effective way to get rid of large amounts of debt. Debt settlement clients notice a drastic reduction in their monthly payments as compared to monthly payments made to creditors. Debt settlement is a superb debt relief option for consumers who have unsecured debt of $10,000 or more, struggle to meet the minimum monthly payment, or are already behind on payments.
Debt Consolidation Program Debt consolidation can be thought of as ‘many for one.’ This means that a consumer takes out one loan in order to pay off several debts. Reasons for choosing this option include securing a lower or fixed interest rate, or to make one convenient monthly payment rather than many. However, this monthly payment occurs over a longer period of time. The decision to consolidate must be weighed very carefully, as a consolidation program can severely limit the ability of a debtor to eliminate debts in bankruptcy. Further, due to the theoretical advantage that debt consolidation offers a debtor with high interest balances, companies will often charge very high fees for the debt consolidation loan. Another detrimental aside is that some companies will actually wait until a client has painted themselves into a corner and must refinance in order to consolidate and pay off debt.
Credit Counseling This involves actually working with credit card companies in order to lower the amount of interest charged. Consumer credit counseling usually allows a debtor to eradicate debt in around 4-5 years while saving some money from the original interest charged. The dark side of this debt relief option is that many of these companies are actually set up by the credit card companies with the goal of collecting as much of the original debt as they can. Their traditional non-profit status is generally a distraction, as all their profit after operation expenses goes straight back into the credit card companies’ pockets. Another drawback is that any assistance from these companies shows up on your credit report as TPA (third party assistance), which can be just as detrimental to your credit score and rating as a bankruptcy!
Chapter 7 Bankruptcy This is considered the final option for debt relief because of the harsh credit consequences. For debtors who owe large sums of money on their credit cards and don’t have enough income to make up the difference, this may seem like the best solution. With Chapter 7 bankruptcy, a debtor is usually forced to liquidate all non-exempt assets of value and pay the creditor money from the sale. The majority of consumers who file a chapter 7 bankruptcy will warn you that the long term consequences are really not worth it.
Our Settlement, Consolidation, Counseling, Negotiation and Bankruptcy Programs Can Help
Or Do Nothing This is as complacent as it sounds. Sadly, even if you are in denial, your creditors will continue to hound you. as a result, this route will most likely cause lawsuits, repossession, anxiety, stress, fear, and more. Ignoring your debts is a surefire way not to make them disappear, and will probably just make them larger. Don’t ignore your debt! It will just cause you more misery overall.
Learn more about our debt counseling services and debt relief solutions by chatting with our team of experts or by sending an email.