Consumers in Texas and all over the US who have a lot of consumer debt are unable to make their minimum monthly payments every month. In many cases, this debt was acquired while paying for household essentials like groceries and electricity or as the result of medical bills from an emergency. While paying off this debt can be difficult, it is possible to do without taking out a new loan and renewing the cycle of debt. If you currently have more debt than you can pay, you do not have to take out a new loan to pay off your debts.
Get Out Of Debt Without A Loan
To get out of debt permanently, start by writing out a list of all of the debts you currently owe. Be sure to include the minimum payment, interest rate, and total amount owed. Next, look carefully at your budget. Try to make changes and cuts to free up extra cash that can be used to make the minimum payments every month or used to make additional principal payments.
Of course, many people in debt have heard this advice many times, and have cut everything imaginable. For some people, it is just not possible to cut any more or earn any more money that can be used to pay off the debt. Other people are simply overwhelmed with medical debts or debts from a period of unemployment that they are simply unable to pay off. Fortunately, there is another option for people in this situation besides declaring bankruptcy.
Alternatives To Bankruptcy In Texas
Debt settlement is a way for you to get a bank or other lender to reduce the total amount of debt that you owe. It is a viable alternative to filing bankruptcy in Texas and all over the nation. Often, lenders will agree to waive penalty fees, interest charges, and in some cases they will even reduce the principal.
If you go through the debt negotiation and settlement process, you will be able to pay less towards your debt every month and in many cases get out of debt faster than if you had continued to make monthly payments.
The debt settlement process begins when you call a debt relief counselor or credit professional who has experience working in debt settlement. After providing this professional with the list of your debts, the professional starts to negotiate with every lender on the list. In many cases, the debt settlement company already has relationships with bank employees who are able to make the decisions regarding debt reduction for a consumer.
Eventually, this debt professional will convince your lenders to reduce the total amount of debt that you have to pay. Often, the professionals are able to convince lenders to waive penalty fees and interest charges.
Principal Debt Reduction For Medical Bills And Credit Cards
In some cases, though, a negotiator can convince your lenders to reduce the actual principal of the debt. This is often true in the case of medical bills. By negotiating directly with hospitals, it is possible to have a bill reduced by up to ninety percent. Credit card companies, pay day loan lenders, and private retailers are all willing to take some type of reduced payment.
The reason lenders are willing to negotiate is that if they don’t, you have a good chance of declaring bankruptcy. If you choose bankruptcy, you will probably be unable to obtain new credit for the next seven years. A lender, however, is legally blocked from ever getting their money back from you. Under bankruptcy law, all debts that are discharged in a bankruptcy are considered to by uncollectable under Chapter 7. That is, a lender will not get any of their money back from an account in bankruptcy.
By negotiating and discharging some of a debt, a lender stands a much better chance of being able to collect the rest of the debt. For this reason, many lenders are willing to negotiate a debt.
Can You Negotiate And Pay Off Credit Card Debt On Your Own?
Of course, negotiating on your own can be difficult to do. Just finding the right person to talk to at a bank can take hours of being on the phone. On top of that, there is often a lot of paperwork to fill out, and keeping track of everything between multiple accounts can take a lot of effort. Using a professional is usually a better option for most people.
If you’re interested in seeing what a debt professional can do for you and your particular financial situation, call or fill out the form. Consumers in Texas and all across America can learn how to pay off unsecured credit card debt without a loan or credit check.