Consumer Debt Solutions

There are a number of ways you can get consumer debt relief besides going bankrupt. Do a simple internet search for consumer debt relief or consumer debt assistance and you will see what I mean. So which do you choose? Which is the best debt relief?

That depends on your situation. Are you still able to make payments on your credit cards every month? If so, you may be best suited for a debt roll-up strategy or credit counseling.

Are you really close to being able to make payments, but are a bit short every month? If so, debt negotiation may be your best bet.

If you find yourself hopelessly in debt, unable to pay at all with no ability to pay in the forseeable future, you may be facing bankrupcy.

Let's take a quick peek at each strategy and what is involved in each.

OK, starting with debt roll-up. This is a great strategy if you can pay at least the mimimum each month on your cards, and are able to add a little more as well. The idea is this, you pay off the lowest balance card first, then take the money you normally would pay to that card and add it to the payment of the next lowest card. You keep doing this with all successive cards until they are all paid. then you can take that monthly amount and add it to your mortgage payment and pay that off too. The typical consumer is able to pay off all their debt including their mortgage in 7 - 10 years, assuming they can stick with it.

The next strategy is credit counseling. Here you enlist the aid of a third party - the counselor - to negotiate with your creditors to lower your interest and late charges. The counselor then sets up a monthly account payment schedule that you deposit money in. Your creditors are paid out of this fund. You then don't have to deal with the creditors directly. This strategy works if you have enough money each month to deposit in the payoff account.

Debt negotiation or debt settlement is when you or a service negotiates with your creditors to payback a portion of your debt - usually 50% - and then are considered payed off. The catch is that the creditor is going to want to be paid in a lump sum. This is great if you can save up about half of what you owe in anticipation of a settlement. There is a great course out that describes this process in detail, and shows you how to deal with your creditors while you are saving, and how to do this your self to avoid very steep fees that a service would charge you. You can find this course here.

So there you have it. each strategy has it's pluses and minuses. It's up to you and your situation to decide which is best for you.

To receive a free report about DIY debt settlement, click here. 

Consumer Debt Solutions |