subject: Debt Relief Companies – A Legitimate Option To Eliminate Unsecured Debt And Avoid Bankruptcy [print this page] Many people are currently struggling with debt. However, if a person finds themselves in this situation, it is important to remember that there is help available.
The easiest method to get out of debt is through sound financial planning and reducing spending, although for many they have already gone beyond this stage and are facing bankruptcy.
In this situation people have to look at either debt consolidation, or debt settlement. Debt consolidation involves a loan from a consolidation company that covers a persons existing debts and allows them to consolidate their monthly payments into one more manageable payment, with a lower interest rate.
They can be very effective, however, a person will only be able to use a consolidation loan to cover unsecured debts and also a persons debt level actually goes up, because of the consolidation companies fees.
This means a person's debt may take a long time to pay off. Another solution which allows debt to paid off much more quickly is debt relief, or negotiation.
Here, a debt relief specialist company acts on behalf of an individual to work out what they can realistically pay on a monthly basis and what their critical debts are. From there they can come up with a revised payment plan.
They then take this to the persons creditors and begin negotiating with them, for reductions in a persons overall debts.
This method is successful because the debt relief companies are able to use their skills and experience in the industry to make creditors understand that if a persons is forced by them to declare bankruptcy, they will end up with nothing.
It then becomes logical from a business point of view to negotiate a reduced payment plan and debts can often be paid off very quickly with this method. Sometimes up to 80% of an individuals debt be wiped off.
Debt Relief Companies A Legitimate Option To Eliminate Unsecured Debt And Avoid Bankruptcy
