How To Get Help with Debt

Today there are many sources to help you keep your debts in check. There was a time when no one ever spoke of being in debt or needing help to survive it. In today’s economy more people are coming out and admitting to their debts and looking for assistance in handling or eliminating them. There are many ways to solve your debt problems. The two most commonly used assistance programs are Bankruptcy and Debt Consolidation.

Bankruptcy offers two solutions to eliminating debt, Chapter 7 and Chapter 13. Chapter 7 eliminates all debts. If you have assets that can be sold to pay off some of the debts they will have to be sold. Those assets can consist of a house without a mortgage or a car that is not encumbered. If you have a debt that is secured you will have to make arrangements to reinstate that debt.  In Chapter 13 you opt for paying off all of the debts interest free over a period of time. The payments are made to a Trustee and you no longer have to worry about the debtors and their harassment.

In a debt consolidation you are not under the protection of the Bankruptcy Court and are therefore, still at the mercy of the debtor. The debt consolidation is somewhat like the Chapter 13 wherein you pay a certain amount monthly which is them prorated by a percentage to each creditor. This is not interest free and the interest still runs making it almost impossible to rid yourself of the debts.

In some instances the creditor will offer you a discounted rate on the debt. For instance, if your debt is $1,000 they will be willing to settle the debt for $300. In most such cases you will notice that the amount settled for is the same or, closely related to the original debt before interest came into effect. This is not a good way to get rid of a debt because you are not really rid of it. If you settle for the $300 the other $700 remains on your credit report as unpaid.

Being in debt and needing to solve it is a powerful stimulant and people will do just about anything to have it resolved. But, relieve the stress of debt solving by using common sense and weighing each resolution possibility. Research each solution and remember it took quite a while to make the debt so don’t try to solve it overnight.


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