In today's economy, debt protection is more important than ever. Lenders of all types are beginning to offer protection as one of the major draws to their institution. With so many consumers on the brink of sinking financially, it's no wonder protecting oneself from debt collectors is sought after as much as it is today. Many American families are losing jobs by either being laid off or simply being let go. Many more families are living on one income rather than two. Worse off yet are those who suffer injury and cannot return to work for the foreseeable future, or families suffering the death of the breadwinner. If you are among the millions of Americans who are trying to ensure their debt doesn't become the ticket to disaster, there are some key elements of debt protection you would do well to understand.
Obtaining protection from debt may seem a little overwhelming, it is actually quite simple. Debt protection will relieve financial stress when you cannot meet your obligations due to unexpected, involuntary loss of income. It will cancel your loan payments without penalty, without adding interest and without reporting you as delinquent to credit reporting agencies. Some lenders will only allow protection for those who meet a minimum credit worthiness. Others are more liberal. In general, there are four circumstances that will be covered by debt protection no matter who you choose to give your business to.
In the case of death, it allows families to get back on their feet financially.
This is a supplement to any disability coverage you may have at work. Most places of employment offer a maximum amount of 60% coverage, so this would make up for the rest while you work your way back to your earning potential.
Involuntary unemployment --
This gives you peace of mind that one of your major payments will be taken care of while you secure new employment.
Family leave --
During a leave from work for family or medical reasons, this will cover a major bill while this often stressful time is being worked through.
Many debt protection programs offer two or three different options, or levels of coverage. You'll need to contact the institution you choose, and make an appointment to meet with a professional who can walk you through the process. It won't be a long process and you will have peace of mind knowing you are covered in these uncertain times should you need it.
Most of these lenders give you a 30 day period in which to go over your plan in more detail, thinking it through to ensure it makes sense for your situation. If you decide against it, all fees associated with it will be canceled.