As a consumer, you owe it to yourself and your family to get out of debt. This can be accomplished through a variety of plans and programs. However, every consumer needs to explore their options before selecting a plan or program. Here is a list of ways to get out of debt:
- Debt Consolidation
- Bankruptcy either Chapter 7 or 11
- Debt Settlement
- Do nothing approach
Before selecting a plan, the consumer needs to understand how and why they are in this current financial situation. This debt was caused by:
- Unable to payoff full balances on credit cards
- Making minimum monthly payments , charging more expenses which increased limits along with the growing interest payments
- Used credit cards to purchase goods and services, ie, food, gas, medical bills,
- Take on more credit cards to payoff old credit cards, ie. balance transfers are lower interest rates
A debt settlement program is a better alternative to the above referenced programs. The reason for using a debt settlement company is they will negotiate on your behalf. They will deal with the credit card companies and work to achieve a settlement of up to half of your current balance. This is not any easy program for the consumer. It requires financial discipline and an understanding of the program. It may take anywhere from 12 to 48 months to be complete free of the consumer debt burden under a structured debt settlement program.
Here are a few items which you will need to address when entering into a debt settlement program: 1) be aware that your credit score will take a hit but it probably already is low due to high balances, minimum monthly payments or late payments, 2) as debt is be negotiated your credit score can begin to rise, and 3) there maybe tax ramifications upon final negotiations with the credit card company.
Debt settlement companies work because creditors often except settlements because if they don’t the consumer most likely will file for bankruptcy. In most cases, this eliminates the any funds to the unsecured creditors.
Contact us today to discuss the in’s and out’s of a debt settlement program that is right for you and your family.
