Debt Reduction Options - Credit Counseling Services Vs Debt Settlement

Debt Reduction Options - Credit Counseling Services Vs Debt Settlement

People from all over the world have suffered badly due to the enduring wave of the recession. The People, who were working on their earning jobs, have lost them whereas those people who are still employed are working under very bad conditions because they are getting performance based salaries along with pay cuts. This is an alarming situation because due to low income sources, people have got themselves in the pools of massive debts. Moreover, harassing phone calls from money recovering agents can make matters worse for the people as they actually lead them to opt for bankruptcy. However, there are other options like debt settlement and credit card counseling for the management of massive debt amounts due to which a person should not opt for bankruptcy.

Debt settlement process has been ever present in the market but these programs have gained extra popularity especially after the recession and their ability through which they help people. Basically, a person is required to hire the services of a legitimate settlement company. After hiring, you are required to deliver all the relevant documentation about the case. Financial experts of the company take over the case after properly analyzing the documents provided. After this, financial experts of the company hold different meetings with creditors in which they convince them to give reductions in the original outstanding amount of the debt. Most of the creditors agree to give reduction. However, these experts use bankruptcy threat to convince those creditors to give 50% reduction in the original amount who do not agree to give reduction in the first place.

Credit card counseling services on the other hand are quite easy because a person is supposed to deliver all the information about debts, due payments and bills to a credit counselor. The selected counselor, after analyzing the documentation, carves out a plan for the person to follow and if a person follows this plan then he will be able to manage his fiscal problems. A person can select these counselors from any one of the legitimate settlement companies but special attention should be given to fraudulent counselors because they are present just to rob people.

If you have over $10,000 in unsecured debt it may be a wise financial decision to consider a debt settlement. Due to the recession and overwhelming amount of people in debt, creditors are having no choice but to agree to debt settlement deals. To find legitimate debt reduction help in your state and get free debt advice then check out the following link.

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