Credit Counseling - Indiana
If you are like many Americans these days who are struggling with their high-interest credit card debts, you may be considering credit counseling assistance. You are not alone. In Indiana and in other parts of the country, many consumers are also overwhelmed with credit card debts - as well as other types of personal loans - and are looking for debt relief.
The good news is, there is a variety of debt relief methods available - including debt consolidation through credit counseling, debt settlement, or a debt consolidation loan. Debt consolidation, or a debt management plan (DMP), typically involves combining or "consolidating," your high-interest credit card debts into a single, more affordable, and more manageable monthly payment that is made to a credit counseling agency, which then distributes the funds to individual creditors.
Another option for many consumers these days is debt settlement, which is a process where you hope to settle, or negotiate, with creditors for a significantly reduced debt amount. Many consumers also find relief with debt consolidation loans, where you typically combine your high-interest credit card debts into one, lower interest personal loan.
Get to know your debt relief options. Request a free debt relief analysis and savings estimate.
Credit Card Debt Consolidation
As previously mentioned, debt consolidation through credit counseling typically involves combining multiple credit card debts into a single, more manageable monthly payment made to a credit counseling agency. If you are considering enrolling in a debt consolidation program, here's what you can typically expect:
A credit counselor will review your finances, debt amounts, and your overall ability to handle those debts. After your credit counselor has a firm understanding of your debt situation and has all the financial information they need, he or she will typically develop a strategy to help reduce your debt amounts. Your credit counselor will speak to creditors, on your behalf, submitting proposals typically asking for lower interest rates, or the waiving or elimination of any late fees - generally, asking them for more affordable repayment terms.
Creditors that accept the proposals are normally placed into the debt management plan. With a single, more affordable, and more structured payment plan in place, you can, hopefully, direct more of your payments towards paying off the principal of your debts versus just the interest. In many cases, debt relief through debt consolidation can help you reduce your debts sooner than if you only continued to make your monthly minimum payments at higher interest rates.
Debt Settlement Alternative
For many consumers who are overburdened with credit card debts, debt settlement is another viable debt relief option. As previously mentioned, with debt settlement, you are hoping to settle with your creditors for substantially less than what you owe. Debt settlement is fundamentally different from debt consolidation in the amount of money paid back - here's how:
With credit counseling, you are typically paying back the entire amount of your debts, just at a lower interest rate and with a more structured payment plan. On the other hand, with debt settlement, you are typically not paying back all that you owe; instead, you are hoping to "settle" or negotiate with your individual creditors for significantly less than your actual debt amount.
As it is with any debt relief method, it's wise to understand the potential risks involved. With debt settlement, consumers are typically advised or counseled to stop paying their credit card bills to save up money, over a certain period of time that they can use to make a reasonable settlement offer to creditors.
In many cases, credit card companies might threaten to sue consumers for defaulting on the terms of their credit card agreements and as a result, many of these consumers will typically see a decline in their credit ratings. Despite these risks, for many consumers, debt settlement remains a popular alternative bankruptcy - which can have a more damaging and longer lasting impact on personal credit.
Your Debt Relief Options
The bottom line is, there is variety in debt relief options available for consumers like you who are overwhelmed with credit card debts. Whether you choose debt consolidation through credit counseling, or debt settlement, it is smart to do your due diligence, thoroughly research potential companies, and understand the pros and cons of your debt relief options. For many consumers, when taken, these steps can help with getting on a path towards becoming debt-free.
Compare your debt relief options today. Request a free debt relief analysis and savings estimate today.