Debt Management - How to Take Advantage of Stimulus Money For Unsecured Debt Reduction

Due to the current recession many debtors became unemployed

. Those who were able to retain their jobs were faced with huge salary cuts. On the other hand the common debtors had loans for everything from a home to a car to consumer products. But in the current financial situation they became incapable of repaying their loans. In desperation they started filing for bankruptcy. The money lending institutions lost large amounts of money. The federal government realized that if a large number of money lending institutions went bankrupt, the finance industry would collapse. This would have a serious impact on other industries and the economy as a whole. In order to prevent this, the federal government came up with the idea of stimulus money. It bailed out the financial institutions with this money and they were saved from immediate ruin.

The financial institutions then decided to pass on this benefit to the debtors. They started offering liberal debt settlement programs. Their idea was to recover at least some of their money from the debtors. The debtors on the other hand were saved from bankruptcy. Debt settlement was a boon especially to those debtors who were reeling under the burden of unsecured loans like credit card loans. With the help of debt settlement programs it is now possible to negotiate the loan amount with the creditors. This reduces the total amount payable considerably. The negotiated amount can then be paid as a lump sum or in installments. The creditors usually waive off the penalties and also reduce the interest rates on the amount payable. This further reduces the payable amount.

The loan amount payable can be further reduced by consolidating several high interest loans with a single low interest one. This unsecured consolidated debt can then be converted into a secured one. The interest rate on the secured loans is comparatively much lower than that on the unsecured ones. All these benefits have become easily available to the common debtor due to the stimulus money provided by the federal government. They can now take advantage of this stimulus money and become debt free through liberal debt settlement programs.

For the millions of Americans who are at least $10 k in unsecured debt, it would be financially prudent to consider the debt settlement option. Creditors are very worried about collecting their debts and legitimate debt settlement companies know exactly what methods to use to get your creditors to agree to eliminate a certain percentage of your unsecured debt.

Debt Management - How to Take Advantage of Stimulus Money For Unsecured Debt Reduction

By: alvin stump

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