A credit card debt solution is the answer millions of American families are looking for to get out of debt. According to the White House, over the last ten years credit card debt rose 25%. 78% of American families have a credit card and 44% carry a balance on it, paying an interest rate of more than 20%.
If you’re reading this, you’re probably one of these consumers in debt. But don’t feel discouraged. Not only are you not alone, but there are different financial alternatives to help you put your finances back on track. The following brief list examines two popular options consumers choose to get out of debt: debt settlement and credit counseling. Take some time to become familiar with the way each alternative works and how they’re different from each other.
Debt: settle your debt for less than what you owe
Service Required: Debt Settlement Company
How It Works: the company analyzes your financial information and negotiates your debt with your creditors for less than what you owe
Main Pros: pay off your debt for less / an alternative to a more drastic measure such as bankruptcy /one of the quickest and more affordable ways to get out of debt
Main Cons: affects your credit score in the short run / doesn’t prohibit creditors from suing you
Debt: begin making payments under a new repayment plan you can afford
Service Required: Credit Counseling Agency
How It Works: the company analyzes your financial information, designs a repayment plan you can afford, submits it to your creditors, and if approved, you begin making payments under the new plan
Main Pros: new repayment plan you can afford / the Agency informs you about financial topics such as budgeting
Main Cons: some creditors consider this option as bad as going bankrupt / you may experience similar inconveniences people that file bankruptcy go through, such as being denied new loans
It doesn’t hurt to keep learning more about these two financial alternatives as well as others that might be available to you, such as debt consolidation. A credit card debt solution could be just around the corner. Examine each option to get out of debt in depth and evaluate how well it adjusts to your particular situation before making a final decision.