Debt Relief Qualifications and What They Apply To
The more you hear about methods of eliminating debt, the more you begin to wonder if these methods can work for you. Even bankruptcy can sound appealing when you’re staring at hundreds of thousands of dollars in debt. However, did you know that you had to qualify for certain forms of debt relief? Not all forms of debt relief can be achieved without some sort of prerequisite being met. Here are a few debt relief qualifications that you might need to heed.
Debt Relief Qualifications You Might Need
When you’re looking to settle debt, you have the option to utilize a debt settlement company. Debt settlement companies generally require the applicant to have over a certain amount of debt to qualify for settlement. While this may deter some from applying, note that in some instances an individual’s overall credit can qualify them for a settlement program. In order to be sure, contact a representative for clarification.
Debt relief qualifications don’t generally extend to credit counseling in regards to the owner of the debt. However, it is important to know whether a counselor is qualified to give you advice on your finances. It pays to know what your specific goals are and whether a chosen credit counselor can help you achieve those goals. General goals, such as setting up a budget, often can be satisfied by any counselor. More specific goals can cost money, like dealing with student loans or debt management. Be sure that your counselor is qualified to assist you based on your needs.
The main qualification one would need to consolidate their debts would be an adequate credit rating. Debt consolidation requires either a loan or a credit card to succeed. Both of those options may require you to have better than average credit. Of course, you can still qualify for a loan even if your credit is less than stellar. However, having a low credit score would then mean you would be subject to higher interest rates. This could pose more debt problems than it solves. Make sure you check your credit before you apply for a consolidation loan.
Filing for bankruptcy requires a few qualifications in order to have it go through. Firstly, to qualify for a chapter 7 bankruptcy you have to make less than the median salary of the state. This can be done through a means test, given when you look to file for bankruptcy. Since a bankruptcy can’t be done without a lawyer, it would be best to consult with one to know if you qualify. You would also need to complete a program with a credit counselor to complete your bankruptcy debt relief qualifications.