Anyone facing a massive amount of debt might need some type of debt reduction program or debt counseling to get back on track. These programs can assist you in managing your finances and help you to budget and make the most out of your income.
Debt Relief Programs
There are a number of debt reduction programs that can help you resolve debt issues. Debt relief programs are designed to help you settle your debt. Sometimes you can settle for more than 50 percent of the outstanding balance.
Consumer Credit Counseling
Debt counseling is another option designed to help you regain control of your financial situation. At consumer credit counseling you work with trained representatives who will examine your debt situation and make recommendations and solutions in the form of a spending plan.
Debt Management Programs
Consumer credit counseling may allow you to enter a debt management program. You will be required to submit a list of all debts. You will make a lump sum payment to the program, which will make payments to your creditors. This program enables you to receive a lower rate of interest on your debts.
Bankruptcy
A Chapter 7 or 13 bankruptcy will allow you to reduce your debt. With a Chapter 7 bankruptcy you turn your assets over to the court, except exempt items, and a substantial amount of unsecured debt is waived. A Chapter 13 bankruptcy allows you to keep your home and car while you continue to make payments.
Settlement
Many creditors will work with you to settle your debts. Use your negotiating skills and see what you can work out with your creditors. Creditors would rather settle with you than receive nothing at all.
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