Debt Relief Options
There are many different terms to describe the various ways to get out of debt. We have combined the synonyms and reduced the list to five major categories: Debt Reduction, Credit Counseling, Debt Consolidation, Bankruptcy, and Credit Card Minimum Monthly Payments.
Debt Reduction
Debt Reduction is the program we offer at Select Debt Relief. Debt Reduction is also known as Debt Settlement. Debt Reduction/ Debt Settlement is a program designed to reduce your principal debt amount by negotiating with your creditors. Debt Reduction is the best choice for most of the people we talk to who are struggling with unsecured debt. This program can get you out of debt faster than Consumer Credit Counseling and keep you out of Bankruptcy. Debt Reduction is the answer for most because it is in the middle, between Credit Counseling and Bankruptcy. It's for someone who needs something more aggressive than a simple Debt Consolidation or Credit Counseling program but is not at the point where Bankruptcy is the only option.
Credit Counseling
A Credit Counseling firm is a third party company that negotiates with creditors to try and lower your interest rates. The main difference from Debt Reduction is that Credit Counseling does not reduce your principal debt amount. Credit Counseling is also known as Consumer Credit Counseling and Consumer Credit Counseling Service. Consumer Credit Counseling companies are not designed to get you out of debt fast, they are actually working for your creditors to make sure they get back as much money as possible given your financial situation. Because of this you will end up paying two to three times the amount back to the creditors than you would in Select Debt Relief's Debt Reduction Program.
Debt Consolidation
Debt Consolidation is to satisfy one or many debts by getting another loan. To Consolidate Debt Loans is not to pay the loan down. Unfortunately for most, when multiple debts start to become a burden, the first thought is to consolidate or transfer the debt into a lower interest loan. This can be done in many ways such as refinancing a mortgage, obtaining a loan off your retirement plan, getting an unsecured consolidation loan, or simply transferring your balances from one credit card to another. Most of our clients who come into the Debt Reduction Program have already consolidated their debts numerous times over the years, which has resulted in a "snowball effect," actually increasing their overall debt balance. Transferring debts from one place to another is almost never the answer. If you are serious about getting out of debt you need to stop consolidating and start reducing the principal debt you owe, right now.
Bankruptcy
Bankruptcy is the final option that people utilize to solve their debt issues. Most people will try every available alternative before they decide to file a bankruptcy and rightfully so; although a chapter 7 Bankruptcy can potentially relieve your debt burden, the cost to do so is high. A Bankruptcy will stay on your credit report for 7-10 years and on public record for over 20 years. Additionally the government has passed new Bankruptcy laws that make it exceedingly difficult for the average debtor to qualify for a traditional Chapter 7 Bankruptcy. Many people are being recommended for a Chapter 13, which is little more that a repayment program that still has lasting long term negative impacts on your credit report. Bankruptcy is only a viable choice when every other option has been exhausted to no avail.
Credit Card Minimum Monthly Payments
Chances are you are reading this now because you have fallen behind on your credit cards or do not like the idea of paying minimum monthly payments for the next 30 years. If you are only making minimum monthly payments and carrying average interest rates, credit cards can take generations to pay off. It is important to understand that a minimum payment only pays down 1-4% of your principal balance. This means that if you owe $10,000 today, it will cost you more than $20,000 over the next 20-30 years before you are debt free. Remember, the Credit Card companies don't want you to pay off the debt anytime soon. This is how they make all their money, by having thousands of customers enslaved in the minimum payment revolving door year after year (not to mention the insane fees and charges for being over limit and/or late on your payments). If you can easily afford triple or quadruple payments then this program is not for you; at that rate you should be able to pay off the credit cards yourself. If you are falling behind or making just over the minimums, don't wait another minute- call today. Procrastination is the worst enemy in making a positive decision about your debt problem. Call now and stop throwing away your hard earned money towards ridiculous Credit Card interest rates.
