Hardship Programs for Debt Relief

When individuals feel like they are drowning in debt, many begin to look into alternative payment options. While filing bankruptcy is an option for some, others would prefer to repay their debts. Choosing a debt relief program designed for financial hardship can benefit many. However, it is extremely vital to research programs beforehand to ensure that the debt management program is legitimate, as companies do exist that will take advantage of consumers looking for assistance.

CareOne Credit

CareOne Credit offers consumers a number of choices when selecting a debt management plan as well as ongoing support and services. CareOne Credit works with consumers and financial institutions to negotiate lower interest rates and payment amounts designed to fit individual budgets. The company also works with lenders to create settlement plans, paying off the debt for a portion of the total amount owed. Benefits of CareOne credit include lower monthly payments, the ability to pay off debts in three to five years, and resources to assist consumers with building money-management skills. Consumers make one monthly payment to CareOne Credit, and the company then sends payments to lenders on the consumer's behalf. As of 2010, CareOne Credit has an A+ rating with the Better Business Bureau.

CareOne Services Inc.

c/o 3C Incorporated

8930 Stanford Boulevard

Columbia, MD 21045

410-910-1735

888-888-CARE

careonecredit.com

InCharge Debt Solutions

InCharge Debt Solutions provides consumers with credit counseling services while working with consumers to determine which debt repayment program will best fit their needs. The company works with lenders to not only reduce interest rates, but also to eliminate late fees and over-limit fees. The company also provides suggestions for mortgage and student loan payments while also negotiating lump-sum payments to allow consumers to pay off their debts at a lower amount. Consumers participating in the debt management program send one monthly payment to InCharge. The company then submits payments to individual lenders per the agreements in place. As of 2010, the Better Business Bureau rates InCharge Debt Solutions with an A+ rating.

InCharge Debt Solutions

5750 Major Blvd, Suite 175

Orlando FL 32819

800-565-8953

incharge.org

Negotiating with Credit Card Companies

For individuals who have the majority of their consumer debt tied up in credit cards, the option to work directly with lenders to lower either interest rates or payment amounts is available. Many financial institutions, including Bank of America, Discover, Citibank and American Express, have in-house hardship programs designed to assist consumers who are struggling financially. Under the hardship program, most lenders will reduce the interest rate on the credit card account, which leads to a reduction in the total amount owed and monthly payment amount. Some lenders will also negotiate a lump-sum settlement with a consumer, accepting an amount less than the total amount owed. In order to qualify for a hardship program directly through a lender, most institutions require that consumers have become delinquent on their accounts. Consumers must also show financial hardship to qualify. A hardship program or settlement will often close the account in order to prevent any future charges and debt.