One of the goals for consumer’s in today’s economic climate is to improve their financial condition. Consumer’s are buried under a mountain of unsecured debt and their largest asset, their home is losing value.
So what does the consumer need to did to get back on track?
Here are five options to consider:
One option is to continue to pay the minimum monthly payments to your creditor for the next 10 to 15 years. This does not eliminate the debt it will continue to climb depending on your interest rate.
The second option is debt consolidation loan which is another way of dealing with your debt by consolidating into one monthly payment. But this does not eliminate your debt only adds to your problem.
The third option is Bankruptcy. But this is not a pretty way to go for the consumer. As the law’s have changed over the years, it’s not as easy as it once was. You need to contact a lawyer to discuss the differences between Chapter 7 and Chapter 13.
The fourth option is credit counseling/debt management. This is a program offered through non-profit credit counseling agencies. Basically they work out a plan with your creditor in which you pay a specific amount each month and the monies are divided between your creditors. Again, this is not eliminating debt along adding more interest and to your debt.
The last option to consider is debt settlement. This is a program in which a third party acts on your behalf to negotiate with your creditors. Each month you set aside a certain dollar amount as that amount grows, the third party starts negotiating to settle your debt. This process can in some cases eliminate up to 50% of your outstanding debt.
Debt settlement is a better way to proceed with getting out of debt.
