Posts tagged ‘debt settlement’

A Critique of Two Popular Debt Relief Programs

Everybody hates scams, right? Well, what would you say if I told you that there are companies out there that rip people off under the premise of helping them? What would you say if I told you that these companies are knowingly ripping off people that are already in a poor financial situation? You'd be outraged, right? Well, the companies I'm talking about in this article do just that. I'm talking about so-called debt relief companies.

Debt relief companies will say they help people get out of debt, while often increasing their problems. They will promise enticing things like reduced payments, interest cuts or even an actual 70% debt reduction. Of course, for people with significant debt problems this is music to their ears.

A good example is unsecured credit card debt consolidation. They will give you a loan with cut interest rates and monthly installments that you can use to clear your debts. What they neglect to tell you is that because you're paying them lowered installments, you will be paying them a lot more money.
While it makes your monthly life a lot easier, you should take a look at the big picture. Not only do people who have consolidated their debt usually end up paying more money overall, they also tend to get into more debt. This is because a real debt solution would require a lifestyle change. If your lifestyle doesn't change, your finances won't change.

Settling credit card debt is another popular choice among debt relief seekers. Debt settlement companies will be able to get you a big reduction of debt. You will get off the hook for a fraction of what you owed.
The downside? You'll have to carry around a bad credit score for several years. This will mean huge  interest rates or even denials on future loans. A bad credit score can be very hard to fix.

You know, I actually have to apologize for my bad choice of words at the beginning of this article. These debt relief companies aren't scams, in the traditional sense of the word. They're doing exactly what they're promising. They will cut your monthly payments in half, like they say. They will arrange a lower debt for you. They're not liars.

However, it is my opinion that if your methods have such big consequences, you should tell people about them. That way they will be able to make an informed choice, knowing all the risks and downsides involved. Most people aren't financial experts or math wizards, and will readily believe something that they really want to believe, such as you getting them out of debt.

When you're promising people that you're helping them with their debt issues, you shouldn't be out just to fill your own pockets with their money. You should have at least some shred of human decency and keep them from making mistakes like these.

How to Effectively Reduce Your Debt

Having debt is scary and frustrating. Not knowing what to do about the problem makes the situation even worse. Fortunately, there is help available. If you truly are serious about wanting to reduce  your debt, you can begin by checking out some valuable resources.

Companies which specialize in debt reduction programs are only a phone call away. They can help with much of the process, as well as being clear about what is expected of you. One of the most important aspects of their service is dealing with your creditors on your behalf. This includes such factors as convincing creditors to reduce or eliminate their late-payment fees and interest rates, and even reducing the actual amount that you owe. Creditors will not be able to harass you when you are working with one of these companies.

Getting out from under debt also takes commitment on your part. While the company can provide useful advice, it is up to you to put it into action. You must evaluate your spending habits, and learn how to budget your money effectively. After all, getting your current debts paid up is only one step. The other step is making sure you will not have the same problem again.

While credit-card debt can be very intimidating, it is not as hard to reduce as you might think. One option is to select the card with the lowest interest rate, and use this one card to pay up the balances of your other cards. If this is a viable option for you, it is essential to not use the other cards, and use the primary card only to pay up the balances. Keep in mind that the card is not a source of instant money, so you are not tempted to make purchases.

No matter how much debt you have, you do not need to continue worrying or allowing the problem to worsen. When you take the first step to reach out for help and constructive advice, you are making the first move to a financially stable future.

Hire A Debt Settlement Attorney To Reduce Debt

Getting out of debt is one of those things that is really hard for most people to accomplish. Most of the time people have credit card debt and the creditors keeping calling them to pay off, and they just can't because the interest rates are so high. One of the only ways to escape this never ending cycle is to hire the best debt settlement attorney that you can. Of course you want to make sure that you hire a good one, because if you don't, you're going to be even further into debt and nothing will have been solved.

The best way to go about this is to interview a bunch of settlement attorneys to see how they go about the whole process of settling someone's debt. While you're learning about what they do, you can also make mental notes on what you think of these people. Are they people who you think will care about you and your situation? If not, it's best to keep looking because you want to make sure that the person that you hire is going to stick up for you, and isn't merely concerned with making money.

After you've done that, you're going to want to check the references of these people so that you know if other people like them. If other people say they're great, good! Go for it. Otherwise keep looking until you find an attorney that people like.

A debt settlement attorney is going to be able to stop all the frustrating calls that you keep getting, and will help you reduce your debt as well as your interest that you're paying. These will dramatically reduce the amount of time that you are going to have to spend in debt. Even though you may lose some points on your credit score in the short run, you're going to be gaining a lot by getting out of debt.

Debt Settlement Facts

For those suffering from the current economic crisis and don't want to face bankruptcy, debt settlement seems like the only option to get rid of debt that keeps piling on. Most Americans will at some time in there life be faced with an economic decision that seems so frightening that they will look anywhere for help.

Unfortunately, most debt settlement programs that are offered on television and the Internet are nothing more than legal scams that end up costing you more in the long run. These companies promise they can help reduce your debt by half of its current value and help you pay it off, except all the while they charge exorbitant fees with no guarantee that they will ever work anything out with your creditors.

The simple fact is that you can work out your own settlements with your credit card companies without ever needing the help of a debt settlement program.

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