Getting Out Of Credit Card Debt – The 4 Most Popular Debt Relief Options

Home Equity (inviting the wolves to the door)

Over the last ten to fifteen years, as home owners from all across the United States watched in amazement as their property values spread steadily upwards without pause, credit card debt seemed almost synonymous with second mortgages and home equity lines of credit. Some of the younger heads of household might have honestly thought that this was simply one of the perks of property ownership in America. Alas, the recent recession showed what happens to economies that forget what goes up must inevitably come down and, in particular, demonstrated the inherent dangers of continually repackaging credit card debt accounts. Even if the original equity consolidation loans boasted single digit rates and tax deductible interest, the credit card debt still remained - just stretched out to thirty or forty years - while the balances were once again cleared for new spending jags.

Peer to Peer Transactions (borrowing from Peter to pay Mastercard)

While actual peer to peer borrowing to cover out of control credit card debts - that is, borrowing from friends and family fordebt relief at the most advantageous terms - should always be considered the absolute pinnacle of any debt relief venture, the so called Peer To Peer or P2P program has far more threatening possibilities. At best, through websites that operate like Ebay and Craigslist by providing a presumably protected marketplace for minimal transaction expense, you may be able to offload your credit card debts to a private individual who'll pay back the credit card companies while offering you lower interest rates in return. In practice, however, the Peer To Peer credit card debt consolidation firms are riddled with scams and con artists, and even the most reputable businesses and investors cannot offer absolute guarantees in the manner of FDIC insured financial institutions.

Credit Card Transfers (borrowing from Visa to pay Mastercard)

Considering the state of the American economy, you can't reasonably expect the credit card debt companies to advertise the same sort of consolidation packages to ordinary consumers in the way that they used to do before the world wide credit crunch. Zero percentage rates for credit card debt consolidation are a thing of the past, even for introductory offers. Even though the corporate billing statements have largely borne the brunt of the federal government's intervention, the recent legislative regulations affecting credit card debt accounts throughout the United States severely restricted the extent of what lenders could promise in terms of introductory percentage rates.

Settlement Negotiation (letting fear of bankruptcy work for you)

At first glance, credit card debt relief through settlement negotiation might seem like nothing more than a high stakes poker game with an experienced counselor as your proxy. On the one side, lenders are obviously wary about ever settling for less than they are rightfully owed, but, at the same time, they are well aware that credit card debt liability can all too quickly disappear forever through Chapter 7 personal bankruptcy protection. You and your settlement specialist, however, also understand that modern bankruptcy regulations have rendered this choice agonizing for even those few borrowers with enough cash on hand to apply for protection and low enough income history to qualify under current legislation. As a result, it really is in the best interest of both parties to come to some understanding about compensating the lender more quickly for a fraction of the total credit card debt. The settlement process has substantial costs, credit scores will take hits, and not every credit card debt holder will be accepted - still, compared to the other alternatives (or compared to letting the credit card debt accrue interest), it's the best option going.

Getting Out Of Credit Card Debt The 4 Most Popular Debt Relief Options

By: adamcouch

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