When you are deep in debt and creditors & collection agencies are constantly calling, sending threatening letters, or harassing you for payment, it is only natural to look for debt solutions to get out from under this stress.
The good news is that the stress can be relieved because there are a handful of proven and time-tested debt solutions available to you. Since there are unique aspects to each of the solutions, it's a good idea to take a look at each one separately and compare and contrasts their merits.
On this page we take a closer look at several of the most popular and effective debt solutions so you can start to identify which ones may be best for you. Millions of American consumers, and more and more every day, are finding themselves in over their heads with consumer debt.
Mortgages, car payments, monthly bills, and daily financial expenditures are piling up, adding to our stress levels. The important thing to remember is that you don't have to face your debt situation alone.
Debt counselors available to help you.
These are professionals who are familiar with all the details of debt relief and who are experience in the art of getting consumers out of debt quickly and painlessly. Trained professionals will analyze your financial situation and give you good options for help.
Managing debt can be stressful and difficult so you can be assured that most all counselors are experienced and professional.
Types of debt solutions to consider Before diving into a new plan for getting out of debt, be sure to do plenty of research on what type of plan is best suited to your needs.
You should take advantage of the help available from financial experts who can guide you to find the right solution. Some of the possible debt solutions include:
Debt settlement program:
This is a great debt relief program if you are in a situation where you need to lower the balance on debts owed. This allows you to pay your creditors off in a negotiated lump sum or via monthly installments.
A debt settlement company can help you set up a program like this so you can get on your way to getting out of debt.
This type of program is suitable for you if you have multiple bills, often too many to keep track of on their own. Consolidating multiple bills into a single monthly payment with a lower interest rate is often quite helpful.
A consolidation plan can be set up for you so that you send one affordable monthly payment while we manage all of your various creditors for you, which gives you a way of getting out of debt with less stress.
This is an ideal plan wherein a credit counselor negotiates with your creditors to lower the interest rates on your outstanding balances. The credit counselor may also design a budget to help you stay on top of your finances.
A debt management plan will have you getting out of debt quickly and affordably. More details on the most effective debt solutions When you find yourself with a troubling amount of debt, with debt collectors and creditors calling you every day to ask for payment, it's time to start looking for real debt solutions.
You don't need to deal with any more stress than is necessary since there are a hand full of proven reliable debt solutions out there. Debt counselors can help you choose the right solution for you by analyzing your finances and getting you on the path to financial freedom.
The most commonly-used and proven debt solutions are listed here. We'll get into the details of each of them a little further down the page, so keep reading: Consolidation of debt: get a single monthly payment for all debts combined Debt Settlement: Pay off your debts with one lower payment Debt Management: An affordable payment plan that you can understand.
This is a debt solution in which you take your various unsecured debts with high interest and combine them into one debt so that you have a single monthly payment to pay down those debts. The main reason you might choose this option is to make your interest rate lower so that you pay less interest over time.
One of the best things about debt consolidation that not all debt solutions offer is the ability to have a single simple monthly payment. After you've started with the debt consolidation program, your previous loan and credit payments are combined into a more manageable monthly payment arrangement. This option can also lower your interest rates.
If your previous loans and credit cards had high interest, paying them off via consolidation can drastically reduce the total interest you pay. It can also lower you monthly payments so that you keep more of your money.
The only bad side to debt consolidation comes about if you don't manage to change your spending tendencies. If you go back to your old ways of spending more money than you should, you could end up in the same bad situation you started in.
Debt Management: Simple payment plan
With this debt solution, a reputable debt management company can help you to eliminate or at least reduce your debt over time. With this program, your consumer credit counselor analyzes your finances and makes a budget for you to use. The counselor can also create a plan to get you out of debt in a reasonable amount of time.
The counselor will often negotiate for you with your creditors to have your interest rates lowered and fees waived. The good sides of debt management include the ability to get your financial life in order without taking out any new loans or credit card accounts, the chance to get professional budgeting help, to escape the stress of having a bunch of bills due with high interest, and the ability to make a single payment every month to deal with debt.
The only down side to debt management is that it can take a long time to pay off the debts you have already accrued. Taking more time to pay means you end up paying more interest, but it may be worth it.
Debt Settlement: Negotiated payment to eliminate debt:
This is one of the most effective and least time consuming debt solutions out there. Settlement is a good choice for people who have too much debt to pay off over a long period of time. It allows you to stop the creditors and collectors from harassing you by eliminating the debt and closing the account.
What happens is that the creditor or lender agrees to accept a payment that is lower than the total debt owed. The debt is considered paid and the account is closed, thereby eliminating that debt.
This is a good debt solution for those who want to avoid bankruptcy and still eliminate all unsecured debts in a timely manner. It's an affordable way to get out of debt, since a large portion of the original debt is essentially erased when the settlement amount is agreed upon.
This can save you a lot of money. It also stops the constant phone calls and letters from creditors and collectors, which can cause so much stress during financial troubles.
For the most part, the professional working with you on your settlement handles communication with the creditors on your behalf. One bad thing about settlement as far as debt solutions go is that you have to pay taxes on the forgiven debt.
So if you owed $50,000 and a settlement is reached allowing you to pay only $10,000, that other $40,000 is considered taxable income by the IRS. It also hurts your credit score to use settlement, since the accounts you settle are considered to be less positive than fully paid accounts.
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3 proven strategies for credit card debt relief
Credit card debt is one of the most common debt problems affecting millions of Americans. Here are some proven strategies for getting credit card debt relief. Credit card debt is one of the most common debt problems affecting millions of Americans.
Here are some proven strategies for getting credit card debt relief. Credit card debt has risen to the top three debt problems among the average American consumer, just after mortgage debt and student loans.
According to the US Debt Clock, our nation’s credit card debt total is around 850 billion dollars. It’s true that knowledge of how to fight debt problems is your best weapon when you're looking for debt solutions. Here are the top methods you should look into if you’re dealing with credit card debt:
- Consumer Credit Counseling: This is a type of credit card debt relief wherein a credit counselor helps you restructure your finances and develop a plan to manage them.
- Debt Consolidation: This may be the fastest way to get credit card debt relief. It consists of using a new loan to pay off existing credit card debts.
- The Snowball Method: Our debt relief specialists can help you with this debt solution. It involves a restructuring of a debt payment plan. Basically you prioritize your debts and pay them off one at a time.
debtreliefconsumer.com can provide you with valuable guidance if you’re considering any of the above methods for achieving credit card debt relief.