I have a bunch of hospital bills that really cost me in credit scores. I really want to try to consolidate it but I can’t find anyone who does debt consolidation without credit card debt. Any suggestions?
Here is something I saw cross my desk today that I thought was a bit funny, but not. At the bottom of a client’s credit card statements was the statement that I had to post a graphic image of in order to preserve it’s full impact (please see graphic inset).
If this is what they consider to be a ”nominal interest rate”, what do you suppose would be a high interest rate? it is no wonder so many people are in a position where they can no longer keep up. There are thousands of people without jobs, gas prices are ridiculous, and the cost of consumer goods has never been higher. You would think that the credit card companies would be best served to lower interest in order to maintain their clients on the books. But, as you can see from this example, that is not the case. We are helping our clients who are in financial hardships get out from under their debts very quickly with a great debt settlement program.
If you have found yourself in a situation where you can no longer stay current on your credit card bills, medical bills, mortgage, etc., you may need to consider a debt settlement program as a suitable solution for getting out from under your debt burden.
A debt settlement program is a great option for those in financial distress and will allow you to continue paying the important obligations such as your mortgage, rent, auto loans, living expenses, while dropping your monthly payments on your unsecured debts to approximately 50% of what they are currently. The new low monthly payment will be set aside into an escrow account, and used to settle the accounts one at a time during the program.
For more information, please watch the short video about debt settlement and visit the website for additional information, or to request a free confidential debt consultation.
Visit online credit card debt consolidation for additional info.
Over the past few years, debt settlement has become a hugely recognized method of getting out from under a large amount of debt ($10,000 or more). Keep in mind that this program is strictly for those who are in financial distress only. If you find yourself in a position where you can no longer make your minimum payments, a debt settlement program can set you up with a new structured monthly payment of about 1/2 of your current minimums. That payment goes into a trust account managed by a debt settlement firm and continues to build a balance over time. As the trust funds accrue, those funds are used to settle your accounts one at a time for significantly less than what is owed.
The most common question that people have is why would a creditor settle for less than what is owed. First of all, yes they do and they do it every day. The reason is because if you are truly in financial distress and the debt settlement attorney has done a good job of getting that information across, the creditors understand that taking a fraction of what is owed is better than getting nothing at all. It is also more financially sound for creditors to take some money and call it good, than spend more money trying to pursue you when you may not have the means to pay. There are also some more intricate details at play here when your accounts are sold to collections for about 15-30% of the balance owed on the account. Now the collection company is pursuing you for the entire balance, but even if they settle the account with you for 20-50%, they make a nice profit. Yes, you read that right… you settle the account for less than you owe and the collection company makes a profit!
If you are interested in getting a quote for a debt settlement program, here is a link to the company we recommend. They have been in the industry for a long time and have a spotless record with hundreds of happy clients. Recommended Debt Settlement Company.
In summary, a debt settlement program can be your best option if you find yourself falling behind on your bills unable to catch up. A good debt settlement program can get you out of debt in about 2-4 years.
When it comes to debt management programs, what most people are looking for does not exist. I cannot tell you how many times I find myself on the phone with a prospective client drowning in credit card debt, looking for the perfect debt management program. Here is the criteria they are looking for:
The problem: There is no such program!
What I have found over years of assisting clients out of debt, is that most are initially looking for a program that does not, and has not ever existed. Let me be perfectly clear, there is no debt management program in existence, aside from just making all your payments on time, that will provide the above benefits.
Now that we have that understood, let’s talk about what options are available and in short summary, provide a basic understanding of each:
Debt consolidation loans are typically home equity loans or second mortgages. This is where you take the equity out of your home to pay off unsecured debts, then just repay the equity loan with one payment, hopefully lower than the total min payments on all your unsecured debts.
The upside is that you can trade in your high-interest unsecured debts for a lower-interest, single payment that can sometimes have a tax benefit.
The downside is that most people who have a lot of unsecured debt will not qualify for a loan, or have any equity in their home.
These are the companies that have been getting into a lot of trouble over past years. Typically non-profit, they claim to lower your interest rates and set you up with a low monthly payment to get you out of debt in 5-7 years by splitting your single payment into little chunks to pay each creditor a reduced payment.
The upside is… well there actually is no upside. Because these programs rarely ever do what they claim, and many credit card companies no longer participate in these programs, this has become a serious waste of money and time.
The downside is, in addition to above, that your creditors will each enter a line into your credit reports on every account included that states that the account is handled through credit counseling. This will prevent you from qualifying for pretty much anything.
In the past couple years, this has become the most popular and most effective program for getting out of debt quickly. However, you must truly be in a financial hardship and not able to pay your current minimum payments. The strategy here is to negotiate with your creditors and get them to accept a settlement pay-off of less than the balance owed. All creditors will accept settlements as long as you have successfully shown hardship. In my experience, attorneys have been most effective in negotiations with creditors because they cannot be bullied by savvy collectors.
The upside is that you can completely settle your debt for pennies on the dollar in a very short period of time; usually 3 years or less.
The downside is that your accounts must become very delinquent before creditors will accept settlements. This is not a problem if you are in a financial hardship; after all, you are already not able to make your min payments, so going delinquent was happening anyway.
In past years, anyone could file bankruptcy chapter 7 and easily eliminate any amount of debt quickly. Now, since the Bankruptcy Reform Act, most do not qualify for bankruptcy, and you are forced to try other solutions such as debt settlement first. Bankruptcy is a legal court process where those who are completely insolvent are able to possibly protect their primary residence and eliminate debts.
The upside is that once a chapter 7 bankruptcy is completed, the creditors literally write off the debt and cannot pursue you further.
The downside is that it is a permanent court record, and will also remain on your credit reports as a public record for up to 10 years.
I hope you find this information helpfull, and that it provides you with a foundation that will allow you to choose the best plan given your circumstances.
