subject: Credit Card Debt and Bankruptcy - Adjustments in Credit Policies May Help Consumers Eliminate Debt [print this page] Credit Card Debt and Bankruptcy - Adjustments in Credit Policies May Help Consumers Eliminate Debt
One can find getting out of Credit card debt to be a struggle. The debt accumulates really fast through credit cards. Most of us are used to a minimum level of debt in our lives. When the amount rises above our comfort zone we cut back on our expenses till it is back on track and then we resume with our spending habits. This method works well till our sources of income do not get disturbed.
The recent economic crash has seen a lot of people out of job unexpectedly. Even the large financial institutions have incurred heavy loss during this time. With such major setbacks on a person's income it is easy to default on the debt account. Most of the people have started looking for different options to come out of debt. One that has gained maximum popularity is debt settlement. This method helps people to eliminate their debts through negotiations between the creditor as well as the debtor.
A debtor can negotiate his debt with the creditors in exchange of a certain amount of payment. This money can be paid as a down payment or through monthly instalments for a certain period of time. Most of the creditors ask for a down payment in order to negotiate the settlement amount. If the debtor does not have enough money to make a single down payment, he can open a new account to save that amount for a certain period of time.
This debt relief program is available to any debtor who has ten thousand dollars or more in unsecured debt. A successful debt negotiation gets a customer debt reduction of about 40 % to 60 % of the total loan amount. It is worth mentioning that this debt relief method has a negative impact on the credit report.
Their are several debt relief options available in this market so it would be wise to speak with a debt relief specialist to determine which option makes the most financial sense for you. Whether it is credit counseling, debt settlement, debt consolidation, or bankruptcy, a debt relief specialist will be able to steer you in the right direction.
