Which debt program is best
When dealing with credit card and collection debt, consumers tend to find themselves trapped in a situation they cannot seem to break free from. What consumers need to understand, is that these credit card companies have designed these credit cards to purposely enslave you by the amounts consumers run up.
Long before our time, the Roman Empire even outlawed compound interest, is it was a way for the lenders to enslave the borrowers. In summary, we feel very similar regarding this topic and feel that consumers need to take control of their debt through the useful debt programs that are available to them. The worst thing a consumer can do is nothing at all, or continue to make the minimum required payments on high compound interest. In summary, we’ll discuss a few of the debt programs. If you wish to speak with an advisor, its always recommended to contact our company.
The four most sought after debt programs
Doing no program, paying it on your own
With unemployment skyrocketing and the average consumer household having at least $14,000 in credit card debt, it’s no wonder consumers are not getting anywhere with their bills. When dealing with credit card debt, you have to understand that the minimum required payment on a monthly balance is usually in the 2% area. If a consumer cannot pay at least 4 to 6% of the balance each month (two or three times the minimum payment), there is no hope.
It’s usually the stubborn individuals whom tell themselves that they have control, only to wake up years down the road with balances similar to what they were the months prior. Consumers need to understand, that credit cards must be paid in full each month and if their not, two or three times the minimum payment should be the absolute lowest requirement. If a consumer wants to stay current with their credit cards, that is understandable and debt consolidation loan would do exactly just that.
The debt consolidation program
The debt consolidation program was designed to help consumers whom were current or semi current with credit card debt. This program which is also referred to as credit counseling, works to lower the minimum payments and interest rates only. Seeing it does not adjust the balance, it does not harm the consumers credit score. Similar to what the consumer was doing the months prior to seeking help, the debt consolidation program will keep accounts in a current status.
The debt settlement program
The debt settlement works for both consumers whom are current with their debt, or delinquent. What happens in debt settlement, is that the consumer makes a newly setup minimum payment which accumulates into a private trust account. Once the amount was built, it’s then when the creditors are settled. Given the consumer has old medical debt, old collections or just things on their credit they want to get off – this program is the ticket. Now given the consumer is active with credit card debt, this program can still work to your benefit but understand that it will hurt your credit.
The bankruptcy option
The bankruptcy option should never be considered. A consumer’s credit score would be horribly destroyed and a judge would try and force you into a higher paying debt consolidation program after auditing your income and expense (October 17th laws signed by former President Bush). If a consumer is having trouble with their debt and cannot afford the high minimums of debt consolidation, a debt settlement program would be best.
Additional resources on debt related programs
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