Do you find it difficult to choose which option is best to solve your debt problems and manage your financial life? If you can’t solve it on your own, you can take professional help to get rid of your financial obligation.
9 Types of consumer debts and their solutions
Here are a few strategies for solving consumer debt problems depending on the type of debt you need to pay off.
Solution:credit card consolidation or bill consolidation - Replace your multiple bills with a single monthly payment.
Suitable if: You can save a certain amount every month after meeting daily necessities.
Credit/Store Card Dues
Solution:Approach a debt relief company - The representative can suggest whether consolidation or settlement will work better for solving debt problems.
Suitable if:You earn a definite amount every month.
Solution:Opt for debt settlement - Approach a settlement company to negotiate with your creditors to reduce the payoff amount.
Suitable if:You want to get rid of your debts fast.
Payday loan consolidation - Approach a settlement company to get help with debt problems. You can get rid of your debts by paying less than what you owe.
Suitable if:You can pay an agreed upon monthly amount to the settlement company towards paying off your dues. You are ready to accept a lower credit score.
Solution:Student debt consolidation loan Take out a loan and repay private student loans all at once.
Suitable if:You’re worried about private student loans.
Consolidate Federal student loans (like Stafford or Perkins loans) through government’s consolidation loan to take advantage of Federal loan benefits.
Solution: Go for credit counseling For debt problem advice.
If required, the counselor can offer a debt management plan or a DMP - You can repay debts with complete professional guidance.
Suitable if:You can take help of a certified credit counseling agency or a reliable debt management company.
Solution: Take help of a debt relief company. A counselor can negotiate to reduce interest rates so that you can repay dues in full. Also pay through single monthly payment.
Suitable if:You’re ready to pay the professional fees.
Solution:Settle with the lender - After repossession, negotiate with the lender to settle the unrecovered amount and the repossession expenses.
Suitable if:You can pay off a portion of the outstanding amount.
Auto loans (Repossessed)
Solution:Take help of a tax professional - To get rid of IRS tax debt. Your tax professional can guide you regarding the best way for solving tax debt problems.
Suitable if:You will have to pay professional fees for the services offered.
5 Ways to avoid being a victim of debt relief scams
- 1Make sure the existing clients have spoken good about the company
- 2The organization need to be certified by TASC and IAPDA
- 3Check out the rating given by BBB (Better Business Bureau)
- 4Take help from a company which is in business for more than 5 years
- 5Compare the fees before taking help of a debt relief company