Debt Relief Programs and Options

Becoming Debt Free Will Improve Your Life!

“When you are in debt, you will never truly be free…”

We believe this quote is so unquestionably true it could be considered a proverb…but let’s be clear. There’s no simple “quick fix” to get out of debt, but learning how to manage debt wisely based on your individual situation while at the same time eliminating “bad” debt from your life should be your end goal. Experiencing financial freedom means you have options.  They enable you to choose what you want to do with your life and where you want to put your money. This will make you happier and also lead to a much less stressful way of life.

This question of “how do I get out of debt” in our opinion really has a two-fold answer.  You see, simply paying off your debt and eliminating interest charges, fees and penalties is only half of the battle. Of course paying off debt is good…it’s terrific! However, to truly get out of debt and experience financial freedom you need to both resolve your current debt and additionally plan ahead to take the steps you need to prevent yourself from falling into debt again.

Far too many people find themselves getting out of debt only to get right back into it a few years or even months later! It’s the same reason why 95% of diets always fail…diets are quick fixes to lose weight that don’t solve the fundamental problem. You have to change your outlook on money and your finances at their basic level to pave the way to a bright financial future. Debt America is here to help, and below are concrete explanations of what we feel are the most generally accepted debt relief or debt management options available to you. We hope you find this information helpful!

Option #1: Continue making MINIMUM MONTHLY PAYMENTS to your creditors

If you are struggling with your current debt obligations and are having trouble keeping up with your minimum monthly payment requirements, we feel this is a terrible option. Not only are you continuing on the path towards a debt trap, but the problem will most likely continue to get worst over time, compounding on itself. Using this option could no doubt cost you thousands of dollars in interest charges, may take up to 20 years or more to pay off your debt, and could end up making you pay up to three-times more than what you owed to begin with! It is our belief that this is the longest, most expensive, and most disadvantageous method to get out of unsecured debt. This is especially true if you are experiencing a financial hardship that could continue to get worse. Maintaining high balances on your credit cards or other unsecured accounts may also affect your credit rating, especially if you are maxed-out or over the limit. This will no doubt make it more difficult to obtain any other form of financing, such as a mortgage, home equity or auto loan.

Option #2: Apply for a DEBT CONSOLIDATION LOAN

A debt consolidation or home equity loan could be a beneficial solution for debt relief if you qualify. However, to do so, especially with the current state of the economy, it most likely will require a good to excellent credit rating, very well documented income, and a significant amount of home equity. If you are in a current state of financial hardship and have missed at least one or more payments, your credit may already be impacted in a negative way. Indeed, missing just one monthly payment on an account could drop your credit rating quite significantly, which is why it’s important to monitor your credit regularly. Perhaps most importantly, though, is the fact that your debt is not reduced to a lower balance than what it was before, you have now simply shifted your unsecured debts to a secured debt via your new home or equity loan. This option should be able to lower your monthly payments but its drawback of lasting typically from 15-30 years and the fact that you pay back 100% of what you owe, plus interest we feel makes it a less suitable choice for those in true financial hardship.

Option #3: Enroll in CONSUMER CREDIT COUNSELING

Consumer credit counseling, also known as debt counseling, or more simply as credit counseling, is a form of debt relief for those with credit card, collections or other qualified unsecured debt. In this program, you pay one consolidated monthly payment into a plan which is structured for you. The main drawback of this form of debt relief is that you typically always pay back 100% of the debt you owe plus interest and your debt is not reduced when compared to a debt settlement program. In addition, credit counseling could take as long as 5-7 years to pay back the debt you owe plus interest.  Another major drawback is that in many programs, if you miss just one monthly payment you could be dropped from the program altogether, even if you’ve had a great track record for several years. Credit counseling programs have historically experienced incredibly high rates of client cancellation, which has contributed to both bad press and an unsatisfying experience for many. Despite its drawbacks, credit counseling may be a viable solution for those with a low amount of unsecured debt (typically under $10,000), are able to afford the monthly payment obligations of the program, and most importantly, are highly disciplined to avoid being dropped from the program.

Option #4: File for BANKRUPTCY

While bankruptcy has been a time-tested and proven method of debt relief, we feel that it should be considered an option of last resort given its profound impact on your longer-term financial health and your credit rating. Bankruptcy can remain with you for up to 10 years or more in certain public records. In addition, many describe it as both an embarrassing and incredibly emotional experience which they would never want to experience again. By no means should bankruptcy be considered a quick and painless method of debt relief and you shouldn’t enter it expecting it to be so. As of October 2005, Congress enacted legislation making it more difficult to file for bankruptcy, including new guidelines for those that are able to qualify. Indeed, a Chapter 13 bankruptcy could result in higher monthly payment obligations and a longer term than a comparable debt settlement program. However, for some, it remains a legitimate choice. This is because if you are in such a financial hardship that you can’t even afford the low monthly payment of a debt settlement program, then bankruptcy may be the most viable and realistic option. If you are considering this solution, based on what we’ve explained, we highly advise you to speak with a credible bankruptcy attorney, licensed in your state.

Option #5: Do NOTHING

There are a legitimate number of consumers who may feel that ignoring their debt problems will be the best way to avoid the issue entirely, and therefore, alleviate themselves from their financial responsibilities. Well, we don’t think there is anything farther from the truth. When you ignore your creditors, you are directly telling them that you don’t want to communicate or having them assume that you do not consider your debt obligations an important part of your finances. If you are experiencing financial hardship and want to see a light at the end of the tunnel, we strongly suggest that you take action right away. You see, recognizing that you need help is probably the most important step in the process toward becoming debt free. The next most important, is recognizing that you have to take steps to improve your life – and locking your debt away in a small corner of your mind will never provide you with a legitimate path to financial freedom. Working with a reputable debt resolution firm can help you to recognize the benefits of living a better, happier, debt free life. Reputable firms can also assist you with minimizing creditor calls or provide a great resource for questions and answers, which is vital once you recognize your problem. Debt America can provide you with sound, knowledgeable advice regarding all of your options. Most importantly, we feel that working with a professional, skilled and experienced in successful debt resolution can provide you with incredible peace of mind.

Option #6: Our Best Choice - THE DEBT AMERICA PROGRAM

Debt America feels that a proven debt settlement program may be one of the fastest ways to get out of debt, often provides the lowest monthly payment, and saves you the most money while serving as an alternative to bankruptcy. Debt settlement is perhaps one of the only methods of debt relief that has the ability to reduce your enrolled account balances and settle them for less than you owe. Typically, your accounts can be settled for 50% less than your original balance in as little as 24 – 48 months. Our programs custom-tailor a payment plan which you can afford with just one low payment each month. In addition, they provide you with much needed education, guidance, customer support, and assist to minimize creditor calls. Most importantly, you should experience much less stress in your life knowing you have a team behind you dedicated to getting you debt free and improving your financial future.

With a Debt America program, our clients’ balances are historically proven to be negotiated down to about 50% LESS than what is owed at the time of enrollment. For example, if you owe $20,000 in credit card or other unsecured debt, we may be able to reduce that total balance by $10,000! In addition, program fees are typically no more than about 20% to 24% of your enrolled debt balances by the time you complete the program, making debt settlement a terrific value for consumers. Also our programs are performance based, which means we do not receive any fees until a settlement has been reached with your creditors.

If you have given our website a thorough review and have determined that debt settlement may be the most practical, realistic, and sensible way to get out of debt, we highly encourage you to give us a call at (800) 681-9621 or simply click here to be taken to our quick and easy fill-in form to request a free consultation with one of our Certified Debt Specialists.

Regardless of your choice for successful debt resolution, we commend you for looking into your options of becoming debt free and hope that we have contributed to helping you make a well-informed, educated, and beneficial decision!