Giving the current state of the economy more and more consumers are turning to unsecured debt as a means to get by during rough patches. As a whole, the US was already dangerously overusing debt as a means of personal finance. Increased use of credit cards has caused some consumers to realize they can’t manage the payments or the level of debt that have put themselves in. This increased use of consumer debt has forced some consumers into a corner they don’t think they can escape from. The good news is there are solutions. There are ways to mitigate and manage credit card debt to give the consumer financial freedom.
One common debt solution used is debt consolidation. As more and more credit cards are used, the fees and interest rates associated with multiple lines of credit can become quickly unmanageable. It’s no wonder they first step most consumers try is debt consolidation. This can be done simply by consolidating down to a better credit card through balance transfers, however, most consumers who are in this category won’t qualify for another credit card. Because of this, a possible solution is a debt relief company. Most debt relief companies can either work with your creditors to do this, or they can do it internally and consolidate your payments down to one lump sum. This can be an attractive option as a lot of accruing interest can be avoided. Usually these payments are substantially lower than the total combined payments a consumer would normally have paying all of their credit cards. Often times this method can also lead to shorter payoff periods as well. Generally speaking, this method doesn’t affect your credit score.
Another method for debt relief is debt reduction. Debt reduction is used to reduce the total amount of debt and often times can save a lot of money. This is generally a last resort even though it seems like the best resort. This method is often used in extreme situations where the payments and the amount of debt will force a consumer into bankruptcy. This method can save a lot of money, but it can also have a negative impact on credit scores. Recent changes in laws have made this a lot safer. Now, debt consolidation companies are no longer allowed to promise debt relief they can’t keep. This makes this route a much more attractive option than it used to be.
While consumer debt can seem like a life ending battle, there are solutions. Get with a reputable debt consolidation or relief specialties to talk out changes that may be right for you. Debt solutions can be the best option.
Angela Tyler has good experience in the finance field, who has been writing on various related topics such as debt settlement & bankruptcy attorneys to help people understand the Debt Settlement process and help them to get out of Debt.