Debt Relief Help
Tips For Obtaining Credit Card Debt Relief
Credit card debt relief has become a top priority for many Americans. Gone are the days of holding multiple accounts with high balance limits. Consumers have grown weary of paying the minimum balance which covers little more than interest rates. Credit card debt relief can be obtained in various ways. Many people are turning to debt settlement companies that offer the promise of slashing credit card balances by half or more. While it is true debt settlement can reduce outstanding balances, consumers often spend as much money settling debts as they would paying off creditors directly.
Debt settlement companies charge a startup fee and monthly maintenance fee. These fees often amount to nearly half the amount of negotiated debt. For example, if consumers owe $10, 000 in credit card debt and the debt settlement company negotiates the balance to $5, 000; consumers would save 50-percent. However, the cost to obtain the savings could range from $2, 500 to $5, 000; resulting in little to no savings at all. This is not to say that consumers should not investigate the option of debt settlement. Some companies use a sliding scale which bases fees on earned income. Others assess fees based on a percentage of reduced balances. Prior to entering into an agreement with debt settlement companies, consumers should visit ConsumerFed.org to review other alternatives which may provide the same, if not better, results. Consumers who are drowning in debt often turn to credit card bankruptcy. This debt relief option often causes more harm than good. First of all, it is expensive to file bankruptcy. Filing fees and legal expenses can cost debtors $2, 500 or more. Many people believe that filing bankruptcy will wipe out debts and provide them with a clean financial slate. The truth of the matter is new bankruptcy laws were enacted in 2005. The Bankruptcy Abuse Prevention and Consumer Protection Act require debtors to repay a portion of debts under Chapter 13 bankruptcy. Debtors are required to undergo the 'means' test to determine the amount of debt to be repaid. The means test compares debtors' income to their states' median income. Those who earn the same or more than the median income are required to establish Chapter 13 payments. Creditor payments are submitted to the bankruptcy Trustee who distributes payments to creditors until debts are fully repaid. Chapter 13 payments are in addition to normal monthly expenses. If debtors are financially incapable of contributing funds, creditors have the right to request the bankruptcy petition be dismissed. When this occurs, debtors fail out of bankruptcy and no longer have protection from the court. Individuals who file for bankruptcy protection are required to obtain credit counseling through an approved U.S. Trustee agency. Consumers with excessive credit card debt should consider obtaining credit counseling prior to submitting a bankruptcy petition. Most credit counseling agencies are well-connected within the credit industry. Credit counselors can often help consumers negotiate outstanding debt by obtaining a reduced rate of interest or reducing the amount owed. Consumers should obtain credit counseling through an agency approved by the U.S. Trustee Program. If credit counseling does not provide required results, consumers can move forward with their bankruptcy petition and will have met credit counseling requirements of the court. A list of approved credit counselors is presented at USDOJ.gov. By Simon Volkov - Simon Volkov is a private real estate investor who specializes in liquidating properties from Chapter 13 Bankruptcy, Divorce and Probate.
debt relief help?
does anyone know any good debt consolidation companies to go with???
i want to lower my bills
and get out of debt faster any suggestions?
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Debt Relief help?
I have 2 credit cards and a loan that I really need help consolidating and getting the payments down along with the interest. Is there any help out that that is nonprofit that can help you with this? Any advice is appreciated. Thanks.
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IRS Debt Relief Help
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