Although the U.S. government provides a wide variety of grants and benefits to its citizens, personal debt relief isn't among them. However, if you need help on your mortgage or are the owner of a small business, you might be in luck. Don't pay for a grant assistance service, however; it may be a scam that can cost your wallet as well as your identity.
Grant Scams: Don't Be a Victim
Late night television and Internet ads trumpeting millions in government grants dollars for debt relief going unspent sounds too good to be true, doesn't it? That's because it is; companies that advertise grant assistance services at best charge you for information that's already free and easy to find, and at worst, steal your identity.
Don't ever provide personal information such as your Social Security number, bank account number, or credit card number to an organization claiming to help you secure a government grant. If you already have, review your credit reports immediately and contact your state attorney general's office to file a complaint. If you notice suspicious activity on your credit report, notify the credit bureau that you're a fraud victim.
Small Business Help
Government help is available for small business owners. Loans -- not grants -- are available from $1,000 up to $2 million. Note that these must be repaid, and that the applicant is required to supply documentation supporting why he needs the loan. Don't apply directly through the government, but through a participating lender.
Using the federal government's benefits website can help you determine what loan program will best suit your needs. You may need to meet certain credit or income criteria in order to qualify.
Mortgage Help
So many Americans began struggling with their home loan that the federal government launched the Making Home Affordable mortgage relief program. If your loan is "conforming" -- meaning, not jumbo -- you can apply for a refinance or a modification.
The streamline refinance program is a terrific option for FHA loan-holders. Minimal paperwork is required; you may not even need an appraisal. Apply directly through your lender.
You should also apply directly through your lender if you think you may be eligible for a mortgage modification. If you're struggling with your payment, it may be reduced to 31 percent of your gross monthly income through a variety of tactics, including lowered interest, principal, or an extended term. Be forewarned: the modification program has garnered terrible reviews; however, it's worth a shot, as it may save you thousands of dollars.
Where to Go for Credit Card Help
The best resource for credit card counseling is the nonprofit agency known as the NFCC: the National Foundation for Credit Counseling. Its counselors, certified in credit and budget management, offer free consultations. You can also enroll in a debt management plan; the counselor intercedes on your behalf with your creditors, negotiating lower interest rates. Your accounts are closed, but made current, and all unsecured debts are paid within five years. Note that the debts must be unsecured; secured asset loans usually aren't negotiable.
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