Marjorie Salada asked:




Debt consolidation and consumer credit counseling are both ways of eliminating your debt. Consumer credit counseling is actually a form of combining your bills, but it does not involve a loan. Sometimes the term debt consolidation can also refer to a home equity loan that is used to pay off outstanding obligations. Consolidating your bills refers to a solution that consolidates your debts and allows you to make one monthly payment to cover all your debts.

A debt consolidation loan is a viable means of paying off your debt, but I do not recommend it. If you have credit card debt or are enrolled in credit counseling and do nothing, your creditors can report you to the credit bureau and make numerous collection calls, but that is about it. However, if you have a debt consolidation loan and cannot make the payments, the consequences are much more severe. Your creditor can start foreclosure proceedings on your home. Many people have debt consolidation loans, but there are better ways.

Consumer credit counseling is a form of consolidating your debts, but it does not require a loan. Debt counseling is a way for people to get out of debt without incurring additional debt. A debt management agency can help you get on a plan that will help you have your unsecured debts paid off in five years or less. If it takes longer than five years, you may want to consider other debt relief options.

Your credit counselor will interact with you lenders and they will no longer be allowed to make collections calls to you as long as you follow the terms of the plan. There are many benefits to debt consolidation with a debt service. Here are just a few of the benefits you will see by consolidating with a credit counseling agency:

*Reduced and possibly eliminated interest rates
*One convenient payment each month
*No more collection calls
*No more fees
*Budgeting and financial education resources

The biggest part of being successful with a debt management plan is not getting into something that you don’t think you can manage. If you are given a quote that you don’t think you can handle, you are setting yourself up for failure if you accept the proposal.

Debt relief is something you need to go into with an open mind and the attitude that you are going to do what it takes to become debt free. The most difficult part of getting out of debt is recognizing that there is a problem and asking for the necessary debt help.

Melissa

DebtFreeorCashPoor asked:

moretimewithmoney.com debtfreeorcashpoor.com How to break out of debt fast and easy without mom or dad’s help John Schepcoff teaches and mentors being debt free. The most common form of consumer debt is credit card debt, payday loans, and other consumer finance, which are often at higher interest rates than long term secured loans, such as mortgages. The amount of debt outstanding versus the consumer’s disposable income is expressed as the Consumer Leverage Ratio. The interest rate charged depends on a range of factors, including the economic climate, perceived ability of the customer to repay, competitive pressures from other lenders, and the inherent structure and security of the credit product. Break out of debt by clicking on my website and giving me a call. you will be glad you did. See ya, John Schepcoff moretimewithmoney.com debtfreeorcashpoor.com

Melissa

Mark Polman asked:




Millions of Americans are finding themselves in deep financial trouble thanks in part to these trouble economic times that we live in. Thanks to lay offs or reduced hours or unexpected medical bills or overwhelming credit card debt, many are seeking help from credit counseling services.

But just what can these services do to help? Are they last ditch resources before bankruptcy or can they help you get back on track with lenders and credit cards that you are current with but struggle each month to make the payment? The answer is yes and yes. Here are a few of the services and what you can expect.

1. Where do you find a credit counseling service?

If you’re having trouble making a credit card payment, your credit card company will be happy to point you towards a certified counselor that they work with. Your bank will also provide a referral even though you have np debt with the bank itself. Of course you can always find them online but be wary. Not all credit counseling services are certified and some charge exorbitant fees.

2. What can I expect at a counseling session?

You’ll be asked to bring in your bank statements, pay stubs and the latest bills from creditors and utilities. A trained counselor will work with you in a non-judgmental way and help you design a budget that will allow you to pay your bills.

3. Will this counseling stop collection calls?

If your debt is with national lenders the answer is probably yes but there are no guarantees. It is important to select a service that has established relationships with major lenders. However, the creditor is not required to stop collection efforts just because you are seeing a credit counseling service.

4. Can counseling reduce the amount I owe?

Possibly but again there are no guarantees. The objective is to make your debt manageable so you can make payments on time, not to settle debt. This may mean that interest rates are reduced and past due fees are forgiven.

5. Can a credit counselor give me legal advice?

Absolutely not. Credit counselors typically have a background in consumer finance or counseling and are not legally trained or licensed to give legal advice.

6. How much do these services cost?

This varies state to state. Certified agencies get funding from grants, private sources, foundations and of course fees from clients. However the emphasis is to provide service at low to no cost. Most people who use the service do make a contribution to the agency.

7. What is a Debt Management Plan

If you are in serious financial trouble you can participate in a DMP which allows the counseling service to negotiate with your creditors on your behalf. Often times counselors can stop the application of interest on a remaining balance, stretch out the time to pay, and have old fees abated resulting in lower monthly payments.

If you’re having a difficult time with debt and you seriously want to end the collection calls and get some sanity back in your financial life, you really should consider making an appointment with a credit counseling service today

Mario

Matt Rayan asked:




Lot of people is held under heavy loans of credit cards, home loans and car loans. And in this time of recessions where prices are high, family expanses are increased and income levels are decreased so every one thinks to get rid of these loans as soon as possible. People find ways to settle these loans.

Many people with jobs have been led to believe they are not eligible for debt relief under the new laws. The truth is, most people with serious debt problems can file for bankruptcy. In fact, there are many ways about personal bankruptcy that people have heard from credit card companies, banks, family members, and even lawyers. A credit card debt settlement is seen as a process for debtors to eliminate a percent of their total unsecured loans and keep from many consequences involving a bankruptcy proceeding. A credit card debt settlement is seen as a process for debtors to eliminate a percent of their total unsecured loans and keep from many consequences involving a bankruptcy proceeding.

In my opinion the bankruptcy is not a right way to get out of these burdens. There are lot of other ways like to consulting the right person or company ate right time. Keeping this thing in mind that you are going for Consumer Relief Debt and the institution also want you to settle. So need not to worry about these thing and even do not think about bankruptcy.

A normal settlement will be around 50% and the only true consequence is actually you probably will get a bit lower credit history. If you want to get out of credit debt and use a financial debt settlement organization regarding debt negotiation then It’s best not to go straight to a individual personal debt settlement business but alternatively to begin with go to a debt assistance network that is affiliated with many genuine credit card debt businesses. So that they can be inside the debt relief network, the personal debt settlement firms will need to prove a track record of productively settling and reducing credit card debt.

These firms negotiate on behalf of indebted consumers who are experiencing a financial hardship with the goal of avoiding bankruptcy.

Tom

Bryan Burbank asked:




Consumer Debt Relief can help you if you have recently got into a problem with your credit card debt. There are programs that are available to you that can help you get rid of your debt and find the relief you need. A lot of people get into trouble because they get so many of those credit card offers in the mail and it is too easy to send them back to get more credit. IN the short term it is great because you fell like you have new found money but in the long term it only hurts you because you usually spend more than you can afford.

A Debt Consolidation Service can be a great way to get your debt eliminates or restructured. These companies will negotiate the debt you owe also they will be able to eliminate fees and lower the rate of interest that you currently pay. They can help you reduce your debt by 40-60% and this will also get you debt free in a shorter time.

Remember that these agencies are looking for people who are behind on there payments and have had a problem managing there credit cards and have gotten into too much debt. Another good reason to use a debt service is because they are professionals and they have the experience you need to get debt free and stay that way. They can also give you some advise about your credit score and how to keep it high so that you can get a loan when you need one.

Remember that using a Debt Consolidation Service can help you get out of debt and they are professionals and you need someone that knows the facts about debt relief.

Martha

MoneyTalksNews asked:

If you carry a balance on one or more credit cards, you’re not alone: according to the Federal Reserve, nearly half of American families do. And nearly half of American families also have some sort of bank savings accounts. If you have savings, should you use that money to pay off your credit cards?

Charles

Vikram Iyer asked:




What will you do if your debts go down by fifty percent in a span of a single day? A bank robbery seems to be the most appropriate answer because that is the only way you can earn enough money in a single day to reduce your debt fifty thousand dollar credit card debt by such a huge proportion. Well, there is another alternative. What makes this really attractive is that there is no need to make any payment to going down your debt.

You can actually escaped fifty percent of your debt without any savior long term damage to your financial credibility. All you have to do is get hold of debt settlement expert and get the expert to convince your lender that you deserve a settlement deal. Of course, you will have to consider various factors before you take a decision.

Avoiding payout requires a proper presentation of the entire problem. Simply providing a long list of all the problems that you are facing also will not suffice. You will also have to point out how the lenders stand to gain by offering your settlement. And this is true. Transferring the debt to a debt collection agency under today is high risk circumstances will mean that lenders will receive any amount five to ten percent of the original amount has the consideration. If the collection agency can recover at least fifty percent, it will be earning a huge profit. This year can be brought down to thirty percent as well without any significant loss to the service provider. On the other hand, a bankruptcy results in a loss for the lender as well as the debt collection agency. That is the reason why it has such a negative impact on your credit history.

Unlike other solutions like consolidation and interest for less, settlement helps you target the all debt amount in full. You do not have to focus on the interest or the penalties along. The combined amount is considered and brought down in a significant manner so that you find it easier to repay the same.

With online resources available at zero cost and at hundred percent conveniences, you just have to check out these options to find the one option that is suites your requirement best.

Thelma

Hector Milla asked:




In life and in business you can overcome any obstacle if you’re willing to look for solutions. Ironically, however, when it comes to charge card debt people appear to experience a sense of learned helplessness. They tend to believe that since they can’t pay their bills that they will be stuck with charge account credit indebtedness for the rest of their life. This is far from true. This erroneous belief system is created because the amount of their debt can be worth one or more years of their earnings. However, there is another way of looking at indebtedness, instead of trying to earn more, you can find a way to pay less. This solution to open-end credit debt is called credit card debt settlement. Although you can do it yourself, you’ll get better results by seeking the professional services of a consumer debt advocate.

How To Locate Legitimate Debt Settlement Services?

If you simply cannot pay your revolving charge bill because you have had to spend more than you earn just to keep up with the rising cost of living, until now you have reached a point where your debt far outweighs your income, than a company that works on settling debt with creditors can help you.

However, while it is easy enough to locate a company offering these services either online, from newspaper ads, and from the phone book, it takes a little more patience to locate a reputable and legitimate service. This is because with the current economic crisis, many businesses have arisen overnight to take care of this new economic need to resolve personal debt due to charge cards.

Once you compile a list of businesses that offer consumer debt advocacy, you will have to call each of them and interview them for your business.

What will you ask them?

Here is a list of questions to ask:

Question 1: Is your company accredited?

Question 2: Does your company have membership in TASC, The Association Of Settlement Companies?

Question 3: Does your company have membership in the Better Business Bureau?

Question 4: Does your company have membership in the Chamber of Commerce for your city?

Question 5: Is your company licensed and bonded in your state?

Question 6: Does the counselor assigned to me have a certificate in debt arbitration?

While all this may seem to be a lot of work, you want to make sure that you are represented by a legitimate and highly professional company that can deliver a quality service to you.

Phillip

Stephen Bis asked:




I have been in the credit card debt relief industry for just about 10 years now and have been in the financial industry for over 20 years. The point of this article is to give people a heads up on debt relief companies also known as debt settlement or debt negotiation companies. I will give you the pro’s and con’s of this process and what to watch out for when interviewing a company to help you get out of debt. Before I go on I want to let you know that this will be a rather long article and by the end of it my goal is to have you understand how the debt negotiation/settlement process works in case you don’t already know and I would like you to understand the tactics of companies out there that do not truly have your best interest at heart.

First I would like to state that the process of debt negotiation as your means of consumer debt relief is not for everyone, some people are better suited for bankruptcy and others do not have the correct mindset to go through this process.

I would like you to first understand what debt negotiation is and how it works. The goal of a debt negotiator is to obtain a debt settlement for you on the current debt amount you owe your creditor. So for example you may owe one particular creditor $10,000 so the goal of the negotiator would be to have you end up paying back say $6,000. The two main benefits of going through this process are to save money on what you currently owe your creditors and to save time. By just paying the minimum payment with even a modest interest rate you will be looking at 30 or more years to become debt free, with a sound debt negotiation program you will be out of debt within 2-3 years or sooner depending on your current financial situation.

Now you must understand these are great benefits but as with anything in life there are drawbacks, nothing is perfect and this consumer debt relief procedure is no different. For starters your creditors will not be willing to negotiate a debt settlement at all if you are current with your monthly minimum payments. They would prefer you to stay on their credit treadmill for the next thirty years and pay them back over four times the balance in interest alone. So you must fall behind on your payments to put the creditors into a position where they will be willing to settle. Once you stop paying them the ball game changes completely and they will then be willing to talk in terms of negotiating a settlement.

So obviously for some people the beginning of this process will have a negative effect on their credit score. For those who are already falling behind then the negative effect will be no different than it already is. Unfortunately for some people this will be the deterring factor that keeps them from going into debt settlement making them a slave to their creditors for the next thirty years. The good news is that this negative effect does not last forever, in fact once the settlements start coming through your credit score will begin to rebound and go back up. The reason being over 30% of your credit score according to MyFICO is based on how much debt you owe. But if you are stuck in a bad debt situation even if you are current with your payments your score is probably not all that good in the first place, and besides when stuck deep in debt your focus should be on how to get out of debt as quickly as possible, not on your ability to accrue future debt.

Now by falling behind on your debts you must understand that these creditors are just not going to roll over and play dead, they will be calling to try and collect the debt. For some this is not a problem at all, for others it is, that is why I stated above this process is not for everyone and the consumer must be in the correct mind set. From my years of helping people there is no rhyme or reason to how many calls you will receive some clients of mine barely get calls while others get them almost everyday. Something to keep in mind too is that no company has the power to legally stop the calls, so any company that tells you they can is flat out lying.

As you can see like I said earlier there are pro’s and con’s, but if you can accept the con’s you will be quickly on the road to financial freedom and will save a lot of money in the process. Now to get to the meat of the matter and why I named this article “consumer credit card debt relief scams”.

We here in America over the past couple of years have been experiencing a very negative downturn in our economy. Thus putting many consumers in a compromising position financially, leaving boat loads of people stuck in credit card debt. So naturally this opened up a much larger market for debt negotiation. Many fly by night companies have been popping up all over the country, many of which are ex mortgage brokers who sold people bad loans and helped them get into this sticky position in the first place. Now I use the word scam which can take on a few meanings, while yes there are some companies out there that are flat out scams and have no intent on doing any work for you at all, most of the times that is not the case. Instead many companies simply do not give people all the facts on how debt negotiation works nor do they truly put them on a plan for success, which I will explain in a minute.

One common issue that most consumers have with debt settlement companies is they do not fully tell them about how the process works, instead they sugar coat things and just preach about the great benefits. I have spoken to countless amounts of people who have signed up with companies and were under the impression that they were going to stay current with their creditors and will never receive any calls. So needless to say this became a huge problem once they began.

Another major problem a lot of these companies have is deceiving people into the kind of savings they will be getting on their debts. Some companies will say they will save you 70% of what you owe. Now while they may get settlements that low what their opting not to tell you is how much you will be saving after you have A) paid them their fees, and B) paid back the creditors. Honest companies will tell you what your true savings will be. If you will save somewhere between 40-50% of what you owe including their fees and paying the creditors than that is pretty darn good. Plus many of these companies will try and guarantee a certain amount of savings, if you hear this run for the hills. NO one in this industry can guarantee a certain amount that is why it is called DEBT NEGOTIATION! They are negotiating to get a settlement for as low as they can get.

Then there are the companies who will let you pay whatever you can to get on their program. These are the worst because they do not truly have your interest at heart and know they are setting you up to fail and not succeed. You must understand to achieve the type of savings I stated above this process should take no more than three years, preferably two or less. And the bottom line is some people simply cannot get it done in that time frame and should realistically be looking into bankruptcy. What these unscrupulous consumer debt relief companies will do is put you on a program for 4 or more years and basically accepts whatever payment you can afford. Knowing full well you are not going to be saving much of anything and will more than likely fail off the program, all they care about is getting the fees and that is it. An honest company will diligently review your budget with you and make sure this is something that you can manage, as well as fully explain to you both the benefits and drawbacks of doing this. And let you make the conscience decision as to whether this is the best consumer debt relief method for your situation.

Another very good way to evaluate a company is to make sure they are registered with the BBB (Better Business Bureau) and that they are in good standings with very few complaints. And if there are complaints make sure they were resolved to the clients liking.

Theodore

Malcolm Murphy asked:


This week has seen the announcement that the UK Government is proposing a number of changes to the way in which credit card providers can operate. The aim of the initiative is to stop providers of credit cards being able to take advantage of customers who cannot clear the balances on their cards. It is estimated that the British credit card industry has an annual worth of approximately £53billion. 

As credit cards were never designed to carry a balance in the longer term they can be amongst the most expensive ways to borrow money.

Some of the tactics used in recent years by the credit card industry have helped Britain earn its reputation as the “debt capital of Europe”. That said, the last 12 months has seen an overall reduction in credit card debt from £66billion to £64billion as people have changed their spending habits in light of the current economic climate.  

The proposed measures include:

Higher Minimum Payment

This is aimed at addressing the fact that, most minimum payments at present are in the region of 2% and make little impact on the balance as the majority of the payment is used to pay of the interest.

Outlawing automatic increases to credit limits

This will hopefully stop the practice of routinely increasing the available credit to the customer without their prior consent.

Annual Statement of Interest

This measure is intended to ensure that every customer is aware of just how much the debt carried as a balance on a credit card is costing them.

The big question is do the proposed changes go far enough? I do have my doubts. However, it is a good start and should be applauded. Only time will tell if these proposals will become reality.



Alan