CC Debt Info

Consumer Debt Solutions…What Can I Do About My Debt?

Many lawyers that profess to assist clients with consumer debt solutions will take loads of cases, leading their clients into bankruptcy, rather than helping them to find a proper debt solution. The lawyers are paid large amounts of cash for their debt relief work; it follows, unfortunately, instead of finding consumer debt solutions, they are out to make a buck in most instances. Now, if you are in some serious lying in bed tossing and turning every night debt and need serious help to pay off credit cards, you should make an appointment with the attorney’s office only as your last resort, and then pretty much chiefly if you are contemplating either a chapter 7 or chapter 13 bankruptcy. There are a number of solutions for eliminating your debts, including debt management, debt consolidation, debt negotiation, and even do-it-yourself debt settlement. Lets take a look at these one by one.

Debt Management

Debt management is simply poring over your budget and finding ways to cut down on expenses and coming up with ways to reduce and eliminate your debt by paying it off in full. This simply isn’t an option for a lot of people that are in way over their heads. Thisis the best solution if you want to keep your credit score intact with minimal dings.

Debt Consolidation

Debt consolidation is the process of taking out a low interest loan – usually against the equity in your home – to pay off high balances (along with high credit card interest rates) on credit cards. This low interest debt consolidation loan usually has a much lower interest rate than a credit card, and in many cases this loan can be tax deductible. The problem arises for a lot of folks when suddenly they find themselves with a zero balance on their credit cards and start using them again. Soon in addition to all the debt from their cards before – now with their house as collateral – they are racking up new debt on their charge cards again. They find themselves right back in the same vicious cycle in need of a debt solution. These types of consumer debt solutions are becoming more and more rare since the burst of the real estate bubble. With the falling of everyone’s home values, there simply isn’t enough equity in anyone’s house anymore to borrow against.

Debt Settlement

Debt settlement, or debt negotiation as it is also known, is the process of working with your creditors to work out or settle on a payment figure, usually about 50% that they are willing to forgive in exchange for a lump sum payment. They figure its better to get something out of you, because if you file for bankruptcy they will receive nothing. There are companies that’ll do the work for you, but they charge very hefty fees to do so. You are better off negotiating yourself using a debt settlement guide. There are plenty to be found online, just make sure to read a lot of debt settlement guide reviews to help you decide on the best settlement course. Just as a side note, creditors will not negotiate with you unless you are seriously behind on your payments. You can expect to receive plenty of threatening phone calls and letters in the mail. The best debt settlement courses will walk you through steps you can take to minimize the junk that credit card companies and collection agencies will throw at you trying to get you to pay up.

 

Once you complete a debt settlement course or debt consolidation program, it will be time to start to rebuild your credit. Unfortunately, your credit score will most likely take a hit if you take any course of action other than paying your credit card bills off in full. Rebuilding your credit will take a bit of work, but it is much easier than the worry you go through with a huge credit load sitting on your back!

 

If you find yourself with recently ruined or dinged credit or filed for bankruptcy, the process of repairing your credit is one of the most important things you will ever do. If you have bad credit, you will find it will pretty much always be hard to get an apartment, to get a house, to refinance a loan, or to get any other form of credit loans – including credit cards…well not necessarily obtaining credit cards, in fact if you end up filing bankruptcy, you’ll probably be deluged with credit card offers. Be very careful! These offers usually are ultra high interest, yearly fees, and steep penalty fees if you miss payments.

 

How About Credit Scores?

Having bad credit is similar to not having established credit, it is frequently easier said than done to get a line of credit from most banks. Consequently, it is very important that you protect your credit rating. There are quite a few ways to build credit, as well as to repair credit. If you are repairing your credit, it will usually take around six months before most banks will allow you to apply for a loan; however, since more than 4% of the population is in debt, companies are coming up with solutions to help debtors out. Again, do your due diligence. Research loan companies, credit card offers and other “rebuild your credit” offers very carefully. Read the fine print closely, there usually is fine points that absolutely must not be overlooked!

 

The United Way and Credit Unions have joined together to help millions resolve their credit issues every day and get out of debt. If you want to rely on an honorable source to help you, then United Way or Credit Unions for debt consolidation are your best bet for your consumer debt solutions.

 

There are a number of consumer debt solutions that are at your disposal, depending on your situation. A long hard look at the amount of debt you have, the income you have coming in and available, what you are willing to put up with in the form of creditor hassle, and the hits you are willing to take on your credit score will determine which route is best for you.