Are you grappling with Credit Card Debt Relief? Making payments for credit card debt is a huge financial hurdle for many Americans. From the high interest rates to making only the least payments every month, it may be difficult to get rid of debt. However, if you are adamant and keep organized accounts, freeing yourself from debt is achievable.
What’s the best form of credit card debt relief?
Here are several solutions.
Look Into Debt Settlement Companies
One of the best credit card debt relief solutions is through debt settlement programs provided by for-profit firms. Here, the company negotiates with the creditors to let you make a “settlement” payment to sort out your account. The “settlement” is a payment in full amount that is lower than your full debt.
To make this payment, the debt settlement program requires you to put away a certain amount of money per month. The amount you set aside is then transferred into an escrow account to collect sufficient savings to settle your account. Additionally, the programs usually encourage clients to halt their monthly debt payments to creditors.
However, you should do in-depth research before you choose a debt settlement program. It is a big decision that entails using a lot of your financial resources. Review the company by consulting the Attorney General in your state or a consumer protection firm.
Other Credit Card Debt Relief Options
Seeking a debt settlement firm is one choice of handling your credit card debt. Other options include:
1. Wiping The Debt Out Altogether in Bankruptcy
A bankruptcy declaration comes with serious consequences, such as a lower credit score, but sometimes, it is the most sensible solution. Bankruptcy comes in multiple types, but most people opt for either Chapter 7 or Chapter 13 depending on their income.
A Chapter 7 bankruptcy is usually a fast process that gets rid of slackened debts through a discharge. Meanwhile, a Chapter 13 bankruptcy enables persons with regular income to pay off their debts over a period of 3-5 years without relinquishing their property. Once you complete the necessary payments, your credit card debt is discharged.
Under the Chapter 13 process, you’ll need to pay an attorney and get credit counseling within 6 months before filing for bankruptcy relief. The credit counseling should be from a government-approved institution.
2. Negotiate With Your Creditors
Take note of the creditors you owe and the amount of money you need to pay them. After that, try to establish how much you can pay each institution according to your budget. Call every creditor and try to get changes in your interest rate or payment schedule to lower your payments.
The credit card issuers might provide you with a hardship plan to lower your interest rates or payments for a set period.
Don’t get into an argument with the customer service representatives if they say no to your request. Instead, ask to talk to a supervisor and present your request once more. Ensure that any agreement made is in writing, before you make any payment.
3. Get in Touch with a Credit Counselor
Reliable credit counseling companies can give you advice on how to manage your debts and finances and help you with budget development. They can also give you access to free educational workshops and tools. These organizations have certified and trained counselors who are knowledgeable of consumer credit, management of funds and debts, and budgeting.
You can discuss your financial status with a counselor, and gain insight on developing a plan to mitigate your credit problems. The first counseling session usually takes one hour.
Credit counselors are usually non-profits and provide their services via local offices, the web or the phone. It is essential to note that the “non-profit” label does not always mean that the services offered are free or cheap.
Still stuck on what’s the best form of credit card debt relief?
Please reach out to Freedom Debt Relief at 800-910-0065.