It is a general knowledge that debt settlement scams are rampant in America and anywhere in the world. This is brought about by those unscrupulous companies and individuals who want to take advantage of other people’s financial troubles. When you want to eliminate credit card debt, the first thing that you must do is to find a legitimate debt relief agency that can help you. Soliciting for professional debt help is not free so do your diligence and choose wisely.
There are several ways to eliminate your debts legally:
Debt Negotiation and Settlement
eliminate credit card debt
Provided that you signed up with a legitimate debt relief agency, your debts can be significantly reduced through negotiation. Here, your agency will serve as your negotiator who will talk to your creditors and plea to lower your total payable amount. This debt reduction is done by reducing the interest and waiving the incurred penalties. Once your creditors and your agency have come up with an agreeable amount, you will then have to settle it again through the help of your agency. When you sent the funds to your agency, it will then be disbursed among your creditors.
Debt Consolidation
If you own several credit card accounts and you owe all of them, it is certainly difficult to handle multiple payment schedules each month. So, in order to address this issue, you must consolidate your balances to just one account. This will simplify everything since you will only have to make single payment each month. This does not instantly eliminate your debts but if you want to pay all your debts at once, you may opt to have a consolidation loan. You can file for either secured or unsecured loan to pay off your balances.
Debt Management Program
If you can live with tight budgeting and frugal lifestyle for years then DMP can be the right option for you. Here, you will be educated financially so you can cope with the long-term debt payment program. This method has a low completion rate since many are not able to comply with the stringent program.
Filing Bankruptcy
You can file bankruptcy based on Chapter 7, Chapter 11 or Chapter 13. Do not think that bankruptcy is the easiest way out because not all applications pass the strict verification process. Not to mention the cost and the paperwork involved.
These options have advantages and shortcomings since there is no perfect single solution to various kinds of debts. However, you need to be very careful in making your choice because debt settlement scams and fraudulent agencies are prevalent.