One of the federal government's responsibilities is protecting its citizens. This comes in the form of national defense and national security, as well as programs and administrations offering subsidies to struggling communities. At times, the government is even responsible for relieving individuals of debt burdens that have become unmanageable.
Bankruptcy
The first, and least attractive, government option is bankruptcy. Established by the U.S. Constitution, this protection enables consumers to start with a nearly clean slate. A bankruptcy judge halts all collection attempts by creditors, and either works out a repayment plan or dismisses some or all debts. This is not the best debt relief scenario as it remains a blemish on your credit report for up to ten years.
Grants
There are a small number of grants available to private citizens for consumer debt. These grants are few and far between, but if a borrower is persistent, he can acquire some government funding. Usually consumer advocacy groups, like Goodwill, must file the paperwork for such grants. These funds normally come in large amounts, and then are distributed among worthy candidates by a non-profit organization.
Farm Loans
Small ranchers and farmers have the opportunity to receive assistance with government loans and grants. Farmers who've been struck by a natural disaster may apply for emergency loans--as long as the President or Secretary of Agriculture have deemed his county as a Federal Disaster Area. Also, low-interest loans from the government can help consolidate high-interest farming debt.
Student Loans
The government offers student loan forgiveness to certain borrowers. To be eligible for this program, you must serve in one of the following ways: in the military, in a volunteer role (approved by the government), or teach in marginalized communities. These forgiveness programs have helped thousands of students relieve themselves of overwhelming student loan debt.
Warning
Before seeking government assistance, be sure that you are unable to repay the debts on your own. Qualifying for such programs usually means that your income will no longer support your obligations. Make a budget and attempt to repay your own debts before looking to the government for help. In many cases, loans and grants are denied based on income.
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