Understanding Debt Settlement and Debt Elimination

Imagine getting rid of a mountain of debt, and doing so legally! Debt elimination is one of the primary goals of Americans who are heavily hit by a faltering economy and waning home prices as well as shrinking nest eggs and college funds. The vast majority of everyday consumers carry in excess of $5,000 credit card consumer debt. Instead of going down, the indebtedness actually goes up.

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Up until just a few years ago it was laughingly simple to receive credit. No matter the credit score – even consumers will little more than a score of 700 could get as much credit as they felt was necessary – consumer credit was a commodity that was extremely easy to get. As a direct result, a good many consumers were not as responsible with their credit as their actual fiscal health warranted 債務重組程序. This has led to unprecedented amounts of credit card debt that is currently born by the average American household.

Eliminating debt requires some difficult decisions that need to be made. Rather than charging anything and everything, a rigorous budget needs to be made and kept. Moreover, living within a consumer’s means is sometimes hard to do if it requires the consumer to forego instant gratification in favor of saving up for a large purchase, or actually denying gratification altogether. Moreover, the amount of money allocated to the repayment of consumer debt needs to be increased.

Using what is considered the debt repayment snowball method, consumers are advised to concentrate on paying off one credit card debt, and then – once it is paid in full – applying those monthly payments to those that go to another credit card. Sadly, for a large number of consumers this is insufficient and will not result in financial freedom in a relatively short amount of time. This is where debt settlement agencies come in; their highly trained debt negotiators work with debtors and creditors to set up a workable payment plan that fits into the debtor’s budget.

Debt settlement is an advantageous step, since it allows consumers to greatly decrease the amount of credit debt they carry while at the same time the payments are drastically reduced. Unfortunately, there is also the fact that a debt settlement leads to some adverse notations on a credit profile, making it a bit harder to obtain affordable financing for a car or home loan. Of course, on the flipside are the avoidance of the adverse notations that come with being late on a number of bills, having some sent to collection, and in the end filing for bankruptcy.

After all, a bankruptcy remains on a credit record for 10 years, while a negative mark remains only for seven. All in all, consumers have the opportunity to undergo debt settlement and debt negotiation, have their debt restructured, and then find financial freedom within about a five year period. Even if you do not think that you are a candidate for debt settlement right now, keep in mind that in the current uncertain economic climate, it only takes the loss of a job to also put you in a position to need this kind of help.

With the economy down and businesses in trouble, one of the things you need to know to succeed is business debt management. Indeed, it can mean the difference between bankruptcy and saving your business, as companies who fail to handle their business debt management properly will fail entirely. Obtaining the services of a good debt management company is the first step in handling your troublesome business debts.

These firms help consumers, but they also help businesses. There are dozens of commercials on the radio advertising their services for individuals, but you may not have realized they can also help your business.

Debt management companies act as a liaison between you and your creditors so that you no longer have to deal with collection calls but can spend your time finding new clients. In addition, they rarely require payment up front, preferring to make their money as a percentage of the payments you make on the debt or your lump settlement fee. This is good news for you because it doesn’t take away from your cash flow.

Another great benefit to businesses is working out arrangements with your key vendors so you don’t have problems with crucial supplies or services due to inability to pay. Debt management will also help you avoid paying legal fees for defense against bad debt, and prevent judgments from being taken out against you, which can ruin your business. Whether they’re negotiating lower monthly payments or a lump settlement for some percentage of the original debt, they provide you with favorable options like debt consolidation that will help you stay afloat.

Business debt management does more than help your monthly cash flow and appease vendors. It reduces your stress levels, helps your credit rating and your image, and can even stop bankruptcy, allowing you to keep your business operating and grow it even in times of trouble. You can be sure that any successful business has successfully handled the management of debt in one way or another.

Most companies that handle debt restructuring will offer you a free consultation, and go over your accounts with you to give you some idea of what they can do for you. This is a no-obligation process and it just might make the difference between you being able to sleep at night or worrying about bankruptcy. It also might improve your credit enough to help you get the funding you need to continue with your dreams.

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