A lot of people are struggling with debt right now, and it's not a good or pleasant situation to be in. People can get out of debt, and it's a good thing that there are real and doable ways to do it. If it's getting harder and harder to pay your monthly bills and you're starting to bounce checks or use one credit card to pay another, it's time to look at these options seriously.
- Bankruptcy - As you may know, bankruptcy is usually the "last resort" for most people. This is because when someone files for bankruptcy, it becomes public record and hurts their credit for 7–10 years. Some people, though, have no choice but to file for bankruptcy. If you can't pay your bills and don't have enough money for debt settlement or a long-term payment plan, this may be your only option. That's fine, too. The bankruptcy law was made for a reason, so use it if you need to. Lucky for you, there are a lot of lawyers who will give you a free consultation to help you figure out if this is the best way to go.
- Credit Counseling for Consumers - You may have heard of consumer credit counselling or even thought about it as a way to get your finances in order. Consumer credit counselling agencies are usually called "non-profit" businesses, and they help people who owe money make plans to pay it back. One of the biggest complaints about consumer credit counselling agencies is that most of the money for each office comes from donations from creditors who get paid by people who pay their debts through that office. This makes it clear that the average consumer has to wonder if the agency they've chosen is really working for them or for their creditors. Still, consumer credit counselling may be a safe choice for you if you can stick to a long-term plan for paying back your debts. If you decide you want to join a consumer credit counselling programme, it's best to go with a company you've heard good things about. Don't be afraid to ask your friends and family for suggestions. You'll be surprised at how many people have been in the same situation as you.
- Debt Consolidation: When you consolidate your debt, you get a loan to pay off all of your loans and credit card debts at once. In other words, debt consolidation means getting a new loan to pay off several other debts. Most people who consolidate their debt do it to get a lower interest rate or because it's easier to deal with just one loan. People with credit problems (like maxed-out credit cards, car loans, student loans, etc.) often do this to make it easier to pay off all of their debts at once. When it comes to credit card debt, this is often a good thing because the interest rate on credit cards is usually high. Most of the time, people who want to consolidate their debt must have enough equity in their homes to use as collateral. Be very careful if you decide to go this route, as 85% of people who have done this have maxed out their credit cards again within 24 months of getting a debt consolidation loan and now owe twice as much as they did before they got the loan. Still, debt consolidation can be very helpful for people who can keep their promise to make their monthly loan payments and have enough self-control not to use their credit cards for unnecessary purchases.
- Debt Settlement - Debt settlement, also called "debt negotiation," is the process of negotiating with your creditors to reach a settlement that everyone is happy with. Usually, this settlement is 50 percent or less of the total amount of debt you owe. In other words, if you owe a creditor $10,000, you might be able to settle the debt for between $3,000 and $5,000 and not have to pay the rest. If you don't have enough money for a lump sum payment, many creditors will agree to take the agreed-upon settlement amount over 3–12 payments. To be eligible for debt settlement, your accounts must be past due, and you must be able to send the settlement money to your creditor before the deadline. If you can't, the settlement agreement will be thrown out, and you will still owe the money. Debt settlement is a good option for people who can't make their monthly payments and would rather get rid of their debt in 3 to 24 months. Click here to find out more about debt settlement.
I really think you should think about all of your choices and go into each one with an open mind. The most important thing is that you get out of debt and can start living again. I hope the best for you.
