Debt Consolidation: Easing the Burden

Mon, Sep 19, 2011

Financial Advice

There’s no doubt that while having a certain amount of debt is normal and a way of life for many, but some of us have gone over the line where we can pay back what we owe in monthly payments. Before any further discussion of this unfortunate situation, it’s necessary to note that facing a major debt burden is something that can happen to anyone. It’s not just the people who don’t know how to manage their money that can get into trouble, but there are also those unfortunate ones among us that are faced with the loss of a job, a family illness, or other unexpected circumstances that can lead to falling behind.

Types of Debt

It matters what kind of debt you have. Most of the debt the average person finds themselves facing is what’s called unsecured debt. This includes the one that most of us struggle with—credit card debt. As well there are those unpaid student loans that have a way of gathering interest, and tax debts as well as medical or legal bills that have gone unpaid.

It happens more and more that people find themselves unable to see over the mountain of debt that they’ve created for themselves. Most of them are good people who would love nothing better than to find a way out and there’s help out there. Debt relief agencies are experts at studying people’s individual debt circumstances and then helping them find a way out.

What to Do About It

The best option is to speak to a professional that can help. A certified debt counselor is the right choice. Professionals are the people that can listen to your situation and help you find a plan to get you back on track. To start, all you need to do is apply to a local debt consolidation program—they are either usually private or non profit agencies that will supply a free quote on the time and interest that will be required. It’s really quite simple and once a plan is in place, you stand to save a substantial amount of interest on the payments and shorten the time it will take to pay the money back. The debt consolidation company that you select works with your creditors to design a repayment method that will both satisfy them and start you back on the road to financial freedom.

There’s a good reason that this is the best option. By consolidating you debt, you avoid having to claim bankruptcy. While bankruptcy does erase many of your debts, it does not take away some of the ones that can swell to large proportions like child support payments and student loans. As well, once you’ve filed either the Chapter 7 or Chapter 13 versions of bankruptcy, you credit rating is affected for up to ten years and you will find it considerably more difficult to get a personal loan, a mortgage or even a job.

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