Debt Relief for Unpaid Credit Card Debt Cambridge MA
Debt Relief for Unpaid Credit Card Debt
Debt Relief Solutions - Dealing with Unpaid Debt
Many consumers face debt problems at some point in their lives. Finding the options that work best for debt relief and credit repair can be quite a daunting task. It can be difficult to even determine which debt relief options are best for a consumer simply because they are undereducated about the topic and already stressed out and uncertain about their future financial situation. However, with so many different people facing debt problems these days, there are a variety of resources for consumers including debt education, debt settlement programs, credit counseling, and even bankruptcy for the most extreme cases.
Ultimately, there are three forms of debt relief that people can seek out: debt settlement, credit counseling, and bankruptcy. Bankruptcy is usually reserved as the last resort for people who need debt relief and cannot handle things on their own. Chapter 7 bankruptcy remains on credit reports for up to 10 years and on public record for about 20, while chapter 13 bankruptcy will stay on credit for 7 years and on public record for up to 20 years. Chapter 7 bankruptcy basically wipes the slate clean for debtors, but also requires them to liquidate all assets that aren't exempt so that they can repay their debts. Chapter 13 allows debtors to get on a 3-5 year payment plan where they repay the debts that they have through the courts by giving up all of their disposable income (which is determined by the courts, by the way) until the debts are repaid.
Credit counseling is much like Chapter 13 bankruptcy, except that consumers work with credit counselors instead of the courts, and can learn about budgeting and financial matters as well. These programs can help people to lower interest rates and make lower payments on their debts or pay them off faster. The programs run for about 4-5 years, and the majority of people who sign up never complete the program simply because there is no room for error or flexibility, which is what many people in financial trouble need.
Debt settlement or debt negotiation is a more current option for debt relief. People who want to pay off debts but cannot afford to do so at the current payment or balance amount often seek this solution. The debt settlement company takes monthly payments from consumers and puts them into a savings account. Once the account has accumulated to a significant balance, the settlement company will call creditors and attempt to work out a settlement option so that the consumer doesn't end up paying the entire debt. Generally this takes 4-8 months, but can take much longer in some cases. It all depends on how much debt there is and how much the debtor can afford to pay every month. The accounts will need to be past due in this situation so that creditors are willing to negotiate, which often leads to a bad impact on credit scores and history.
Dealing with debt is never a fun situation. However, if you do take the time to address it and seek out one of the many solutions that is available, you will find it much easier to handle than if you sit back and do nothing. Make sure that you consult with the right qualified professional sources to find the best solution for your debt relief.
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