Debt Settlement - Indiana
Are you overwhelmed by high-interest credit card debts, looking for relief, and considering debt settlement? If you have hit a rough patch financially, perhaps due to circumstances beyond your control like a job loss or medical emergency, you are not alone. Today, many residents and families in Indiana as well as in other states are also struggling with credit card debts and are looking for debt relief. The good news is; you have several debt reduction options that might alleviate the pressure and help you breathe easier.
For many consumers, one proven debt relief option is debt consolidation, where you typically combine your high-interest credit card debts and other unsecured debts into one, more affordable, and more structured payment made to a credit counseling agency. An alternative method is debt settlement; when you enroll in a debt settlement program, you are hoping to settle or negotiate with creditors for a reduced amount of your credit card debts.
These days, both debt consolidation and debt settlement have become popular alternatives to bankruptcy, which is also a form of debt relief - but one that can have a more devastating and longer lasting impact on personal credit.
See your debt relief options now. To request a free debt relief analysis and savings estimate - start here.
How Does Debt Settlement Work?
For many consumers struggling with credit card debt, debt settlement is a viable option to getting off the debt treadmill. Unlike debt consolidation where you are typically paying off the entire amount of your debts, just at lower interest rates, with debt settlement - you are hoping to settle or negotiate with your creditors for significantly less than what you owe. If you are considering debt settlement, a few words of advice: As the term suggests, credit card companies are certainly not legally required to accept or "settle" with you.
In many cases, you will be advised to stop making payments on your credit cards to save up money over a period of time that you can later use to make a reasonable settlement offer. In many cases, creditors might threaten to sue if you default on the terms of your credit card agreements. In addition, if you default on the terms of your credit card agreement, your credit rating will typically go down.
However, despite the potential impact to your credit score, debt settlement remains a popular debt relief alternative to bankruptcy - which can have a more serious and longer-lasting effect on your personal credit.
Credit Card Debt Consolidation
As noted earlier, if you are struggling with debts and still uncertain about debt settlement, you might find relief through another process known as debt consolidation, or what's sometimes referred to as a debt management plan (DMP). Debt consolidation typically involves "consolidating," or combining, your multiple, high-interest credit card debts into a single and more affordable monthly payment made to a credit counseling agency to be disbursed to creditors.
Consumers who enroll in a debt management plan talk to credit counselors who will review their finances and debt situation. Once they have all the financial information that they need, credit counselors will typically make proposals (on a consumer's behalf) to creditors requesting a reduction of interest rates, or the waiving or elimination of any late fees and other penalties.
Creditors that agree to the terms of the proposals are entered into the debt management plan. It's important to understand that while it is the credit counseling agency's responsibility to disburse funds to creditors, the responsibility lies with you to make sure that you have money available in the account set up for your monthly payment.
Reputable credit counseling agencies might even provide you with a due date (the date that they draw money from your account) that takes into consideration, for instance, when you get paid or have the funds available in the account.
The bottom line is; if you are struggling with debts, there is help available. It is a smart thing to do your due diligence and fully understand the pros and cons of debt settlement, and all your debt relief options.
Explore your debt relief options today. Get a free debt relief analysis and savings estimate - at no obligation to you.