Debt Relief Options
If your credit card debts have spiraled out of control and you can't afford to make regular payments anymore, you may be interested in exploring your debt relief options and finding out about a program that could finally help you pay off your debts. One proven option is what's known in the industry as debt consolidation or a debt management plan (DMP).
Facilitated by credit counseling agencies, debt consolidation programs allow many cash-strapped consumers across the country to find relief from their high-interest credit card debts, as well as unsecured debts (like medical bills, utilities, student loans, department store charges), with a more structured and more manageable payment plan. The goal is, with a more structured and more affordable repayment plan, you can, hopefully, direct more of your payment into paying the principal of your debts versus just the interest, and reduce your debts at an accelerated pace.
However, debt consolidation is certainly not the only option when it comes to finding debt relief. Another proven option is called debt settlement, or debt negotiation. Unlike debt consolidation where you are paying the entire amount of your debts - just at reduced interest rates - with debt settlement, you hope to negotiate with creditors for substantially less than what you currently owe. In these tough economic times, both debt relief options have become popular alternatives to bankruptcy, which can also provide you with a fresh financial start, but it has a more damaging and longer lasting impact to your personal credit.
To find out how debt relief could help, get a free debt relief analysis and savings estimate - at Virginiadebtrelief.org today.
Benefits of Credit Counseling
For many consumers, rising credit card and unsecure debts are serious problems that won't just magically go away. The good news is, there are debt relief solutions that may help pay off your debts more quickly and could even lead to savings. As mentioned earlier, one of the ways that you can find debt relief is through a process known as debt consolidation, or a debt management plan (DMP). The goal of a debt consolidation plan is to "consolidate," or combine, your unsecured debts into a single, more manageable and more structured monthly payment made to a credit counseling agency.
Debt consolidation typically begins with a review of your income, outstanding debts, and other assets with a debt relief specialist or counselor. This process generally entails taking stock of all your spending, debt amounts, and other expenses, as well as adding up the balances on your credit cards and the rates that you are currently paying. Once credit counselors have a clear picture of your finances, they typically submit proposals to creditors, on your behalf, requesting lower interest rates and the waiving of late fees and penalties. Creditors that accept the proposals are added to the debt management plan. Credit counseling agencies, in turn, distribute those funds to creditors that are in the plan.
The goal of this debt relief option is, with a more lenient and more structured repayment plan, you could ideally pay off your debt at a more predictable and accelerated pace.
Your Savings with Debt Consolidation
For many consumers who have the discipline to watch their budget and stop relying on their credit cards for most of their purchases, a consolidation plan can likely help them get on a path towards reducing their debts and potentially lead to savings. Keep in mind, however, that while it is the credit counselor's responsibility to request from your creditors a more lenient repayment plan, it is your responsibility to ensure that you have the funds available in the account set up by the credit counseling agency.
In addition, make sure that you understand how much savings you can potentially get, every month, with a debt management plan. Typically, your savings depend on several factors: the total amount of your debts, the current interest rates, and any late fees or penalties.
The bottom line is, if you are ready to tackle your credit card and unsecured debts, take the next step and find out what debt relief can do for you and your family. To explore your debt relief options, request a free debt relief analysis and savings estimate - from VirginiaDebtRelief.org today.