Best Debt Relief for You
While there are many options for debt relief options in existence, only one or two may be exactly what you need depending on your debt. The best debt relief options are those that will cater to your needs financially, taking into account your ability to handle certain types of debt relief. Knowing what your financial needs are is the key to finding the best debt relief option for you. Here are the main debt relief options for you to choose from.
Debt settlement is a method of debt relief that can help to reduce the amount of debt you have before looking to eliminate the debt altogether. To achieve this, those in debt have one of two options. A debtor can either negotiate for debt settlement on their own or they can enlist a debt settlement company to negotiate on their behalf. While both are valid methods of achieving debt relief, the best debt relief option depends on which version of debt settlement approach works out best for you.
Settling your debt on your own can be beneficial if you know what you’re doing. Talking to a debt collector or a credit provider can quickly become futile if you’re unaware of what you’re negotiating for. This is why debt settlement companies are so highly regarded when it comes to settling debts. Many debt settlement companies have pre-established working relationships with your credit providers and can experience greater success in debt settlement negotiations.
Debt consolidation allows you to pay off your existing debts with the use of a debt consolidation loan. This can help to eliminate multiple debts at once, leaving just one debt instead. This is the best debt relief option for those who simply need to reorganize their debts into one, manageable form. This won’t lessen the amount of debt you have, but it will allow you to trade in multiple due dates, late fees and interest rates for just one set.
If you have the ability to use debt consolidation, it would mean your credit is healthy enough to garner a loan of adequate size. Many individuals do not have the credit necessary to secure that type of loan and, thus, would not consider this the best debt relief option for them. Also, as stated earlier, debt consolidation does not lessen or eradicate the debt altogether. It simply combines multiple debts under one financial obligation. If you don’t need help with the amount of debt you have, but you would like to restructure multiple debts into one debt, debt consolidation can be the best debt relief option available to you.
Credit counseling helps to educate you on the finer points of dealing with your own personal debt. A credit counselor can give you advice on the types of debt you have and the best ways to deal with them. The advice is specially made for you, based on your debt and your financial ability. In certain instances, your credit counselor may suggest a debt management program for specific debts you have. During a debt management program, you’d be required to pay your credit provider back in monthly installments without having to worry about interest rates being added or late fees from the past.
The best way that credit counseling can help is if you only need information on how to handle your debts. Most credit counseling services are free and don’t require you to commit to a program of any sort. Credit counseling services also do not actively affect your debt in any way (save the debt management programs). If you have the means to handle your debt, but you are unsure of how you should go about doing so, a credit counselor might be the best debt relief option you have.
The last line of defense against debt, bankruptcy has the greatest benefit while being the most damaging to your credit. Filing for bankruptcy can easily eliminate all of your unsecured debt in one fell swoop, ridding you of your obligation to pay it off. While this is more than other forms of debt relief will do, a bankruptcy filing can remain on your credit record for up to ten years and can prevent you from applying for new forms of credit for years.
Bankruptcy can be the best debt relief option for those who are in immediate need of debt relief. Bankruptcy has the ability to halt many types of collections from forcibly taking money from you. Should you find yourself in a financial pinch, filing for bankruptcy can help you keep your money. However, your ability to take out a loan, open a credit card, or even work in some professions will be limited (if not totally halted). Be sure that your other debt relief options aren’t better for you, as bankruptcy might not be the best debt relief option, but the only option you have left.