Is Debt Help Worth Debt Consolidation Vs Debt Settlement?

If you find yourself overwhelmed with debt or facing financial difficulties and are looking for help, debt help is a valuable resource that can help. Debt cancellation or debt settlement is the temporary or partial cancellation of debt, owed by people, companies, or countries. Debt cancellation will allow you to reduce your debt balance through repayment plans with your creditors and will allow your credit to improve while you pay off your balance over time.

Debt help is available from many different sources. You can contact your creditors directly to discuss debt reduction and repayment plans; you can visit online debt relief websites to research debt help, and you can use services offered by a debt consolidation company to consolidate your debt into one payment with a lower interest rate. Debt consolidation can offer debt help in a number of ways and allows you to get out of debt faster.

If you are feeling financially insecure and unable to make your monthly payments, consider a debt consolidation plan. This can help you reorganize your finances to avoid bankruptcy. Most credit card companies and loan providers will negotiate new terms on loans and mortgages with consumers who file for bankruptcy. Once a consumer files for bankruptcy protection from their creditors, their debts are protected. Bankruptcy stays on credit reports for ten years and cannot be used as an asset protection. Consumers can still have high interest rates and fees with a bankruptcy on their credit reports.

Debt help is also available through a process called “settlement” – negotiating with your creditors and obtaining a percentage of the outstanding debt reduced. A percentage of the outstanding debt is usually around 50 percent of the total. Many creditors want to renegotiate this figure because it provides them with a lump sum of money, which is much less than they would receive if the account was closed.

If you are unable to meet the requirements of a settlement agreement, you may wish to contact your card issuers directly. Often, card issuers offer settlement plans to people who can no longer make their minimum payments. You must be persistent in contacting your card issuers to negotiate these settlements. Some debt help companies are not equipped or trained in negotiating these types of settlements. Your best bet is to work directly with your card issuers.

The choice between debt consolidation vs. debt settlement depends on how you wish to manage your debts. If you have overwhelming multiple debts, bankruptcy might be the best option for you. However, if you are experiencing a financial hardship and struggling to keep up with your monthly payments, a debt consolidation vs. debt settlement program might be the better option for you.