Do you feel as if you were being haunted by your debt? Is it standing over there in the corner like the ghost of Christmas past, rattling its chains and preventing you from getting a good night’s sleep? Or is it even worse than this? Are you getting nasty phone calls from credit card companies or debt collectors–both at home and at work? Do you feel sick to your stomach when your manager calls you into his or her office because you’re afraid your wages are being garnished?
Credit card relief
You don’t have to feel this way because there are ways to get credit card debt relief and it might be easier than you think. The first of these is called a debt management plan. Is there a consumer credit counseling agency in your area? If so, you could sit down with one of its counselors and let him or her help you develop a plan for paying your creditors.. Your counselor will contact all your creditors, inform them that you now have a debt management plan (DMP) and negotiate with them to lower your interest rates and waive any late fees and give you more time to pay back what you owe. Once all your creditors accept your debt management plan, you will probably pay the credit counseling agency once a month and, it will use your payment to repay your creditors.
The pluses and minuses
Probably the biggest plus of a debt management plan is that it will stop all those nasty phone calls or threats to garnish your wages. You will have only one monthly payment vs. the dozen or so you may have now. And the monthly payment should be more affordable than the sum total of your minimum credit card payments.
However, there is a downside to a debt management plan, which is that it does nothing to reduce your debt. You will have to pay back every cent you owe, plus interest. It will probably take five years to pay off all your debts using a debt management plan and it can have a negative effect on your credit score.
Almost all credit card relief programs will have a negative effect on your credit score.
A second way to get credit card debt relief is through a debt consolidation loan. If you own your own home or have another asset you could use as collateral, you should be able to get a secured loan. The two most popular of these are second mortgages and homeowner’s equity lines of credit. If you don’t have an asset you can use as collateral, you might be able to get an unsecured loan. It will come with a higher interest rate as the lender is taking more of a risk as there is no asset it could be seize or foreclose on should you fail to make your payments.
The biggest plus of a debt consolidation loan is that it will get you a lower monthly payment than the sum total of your minimum credit card payments. This is basically because you’re extending the length of your loan and you’ll have a lower interest rate. However, it does nothing to reduce your debts. You will have to pay off the entire debt consolidation loan plus interest.
The one way to get your debts reduced
There is really only one way to get your debts reduced and that is through debt settlement, which is what we recommend. We have years of experience helping families reduce their credit card debts to a fraction of what they owed and become debt free in 24 to 48 months. If you feel that that settlement might help you achieve credit card debt relief, give us a call or jump on a chat or fill out the free debt analysis form to get started.