Debt Problems - How can you solve it the best way?

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.

Credit/Store Card Dues
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.
Medical bills
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.
Personal loans
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 loans
Solution: 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.
Student loans
Solution:Student debt consolidation loan Take out a loan and repay private student loans all at once.
Suitable if:Youre worried about private student loans. Consolidate Federal student loans (like Stafford or Perkins loans) through governments consolidation loan to take advantage of Federal loan benefits.
Multiple bills
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.

Utility bills
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.
Auto loans (Repossessed)
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.
Tax debt
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.

Last Updated on: Fri, 18 Sep 2020