subject: Obama's Debt Relief Plans - How Government Tax Breaks Help Consumers Settle Debt [print this page] Obama's Debt Relief Plans - How Government Tax Breaks Help Consumers Settle Debt
Obama's debt relief plans has been welcomed by the citizens of America as the onset of recession in the past two years has taken a heavy toll on the economy of the USA. The loss of jobs resulting in shortage of regular income flow, the crashing of stock markets, shutting down of small companies etc. are few of the devastating effects that have marked the lives of the average American. This has also caused a large section people to land-up in heavy debt, many of whom declared bankruptcy and foreclosure. Such declarations have been causing both the debtors and creditors equal dissatisfaction. President Obama's debt relief plans have attempted to provide solutions to this which may not be applicable at all times for all debts but has proved effective in many cases.
Generally the people burdened with $10000 worth of debt or more can take recourse to 'debt settlement' or, 'debt negotiation'. The creditors will only be too happy to settle debts than to loose the entire amount owing to filing of bankruptcy. The Obama government has taken commendable steps in bringing government influence in the unsecured loan territory (like credit card debts) which was initially not very easily available to the average citizens. Laws that specify exactly how much to charge from the consumers on these occasions are being put into effect.
According to statistics, in the year 2009 the average debt settlement was 50%. It will be untrue to say that the creditors suffer colossal losses on non payment, because every bad debt is compensated in terms of government tax breaks. So, the creditors are in no hurry to drag the consumer down to foreclosure, and can wait till the time they are ready to cough up some of the due amount. This way the affected can negotiate to bring down his or, her debt by 50% or, even lesser.
President Obama's debt relief plans have also made an attempt to make the creditors more adjusting to the needs of the defaulter in trying circumstances. The 'Making Home Affordable Program' by the Obama government to offer relief to the troubled borrowers of home loans can be put up as a good example. In this relief program the monthly installments can be reduced to even below 30%. The interest rate of the loan will also get reduced.
If the alternative to settle debt is not possible because of excessive financial hardship then the person concerned can apply for debt relief government grants. To seek this benefit the consumer will have to prepare a relief grant proposal letter which should contain all details about the kind of loan, reason for non payment and how the person wills to spend this grant money. The only difficulty in this is that all of the proposals are not accepted. Only the worst case scenario will get preference.
In conclusion it can be said that president Obama's debt relief plans have had a considerable impact on the economy of the country. They may not be absolute and concrete in their application, but they have been taken advantage of by many. For the group of people still in trouble, it is always advisable to seek help from a debt relief agency.
Debt settlement companies are widely available in just about every state however some are just flat out more experienced than others in debt negotiation. That's why it's so important for consumers to use debt relief networks. These networks qualify and only accept the best performing debt settlement companies.
