Debt Relief is a process in which Practical Debt Relief negotiates to pay
your creditors less than the full amount owed for your unsecured debts. In
order for somebody to successfully benefit from debt relief they must have a
financial hardship that was documented during the application process. The
creditors happen to be human beings as well and as long as they understand
your situation they will be willing to negotiate, giving you the credit card
debt relief needed.
Making the decision to contact a Debt Relief Agency is not an easy one
Making the decision to take that first step toward debt relief is not an easy one. There comes a time when it can become unbearable dealing with all the stress of worrying about how much money you owe. If you find yourself tapping into your savings to pay for current bills or taking cash advances on one card to pay for other bills or another card, you need to keep reading!
Debt Relief Options:
Debt relief for unsecured credit card debt:
This is a great alternative to bankruptcy offered by Practical Debt Relief. Many people are feeling the financial crisis due to the inflated interest rates of the credit card companies. Most can barely keep up with the minimum payments, and can only dream of paying down the balances. With the mounting stress and increasing balances that are commonly associated with unsecured credit card debt, it’s only fair to know what your options are. Doing the proper research is also important and working with an experienced company can make a huge difference in providing you with credit card debt relief.. When you work with Practical Debt Relief our Licensed Debt Arbitrators will negotiate with your creditors to give you the debt relief help needed so you can focus on your life again. In most cases we will cut your payments, allowing you to pay back only a percentage of what you owe and getting you out of debt in the shortest period of time possible*.
Chapter 7 Bankruptcy Debt relief:
Bankruptcy debt relief is an option where an individual can completely eradicate all of their unsecured debt. If the court can find or prove that you have any assets they will liquidate all of those assets in order to pay something to your creditors. This option is only good for somebody who has no income or no assets and should be considered as your last resort due to the severe long lasting effects. Bankruptcy laws were also changed a few years back making it harder to qualify for Chapter 7 bankruptcy. We suggest you consult with an attorney for more information regarding bankruptcy laws, as we do not provide legal advice.
Chapter 13 Bankruptcy Debt relief:
Chapter 13 bankruptcy debt relief is the act of reorganizing all of your debts. In this situation you basically turn over all income to the courts or trustee and they make payments to your creditors on your behalf. The bad news is that this program can take up to 5 years and during that time you have no control on how your money is managed. The court makes all the decisions for you. Not too much like the American way. With a great bankruptcy alternative like debt settlement you should consider all your options before rushing into a big decision. Please consult with a bankruptcy attorney should you have any more questions regarding this option as Practical Debt Relief does not provide legal advice.
Debt relief thru debt consolidation:
In debt consolidation a credit counselor will negotiate pre-determined interest rates with your creditors to reduce your payments and stop the over limit and late fee’s. The problem with this option is that it takes twice as long as debt settlement and some of the creditors may decide not to participate. It is also reported to the credit bureaus that you are utilizing the assistance of a third party in order to consolidate and reorganize all of your debts. While an effective program for some, it has been shown that the majority of consumers who enroll into a debt relief consolidation program never actually complete the program.
Debt relief by obtaining a debt consolidation loan:
If you still trust the real estate market and want to jeopardize your home and everything you worked for to get it, then you might want to think twice before deciding on a debt relief consolidation loan.. This is an option where you’re consolidating unsecured credit card debt that should be managed and paid off regularly and financing that unsecured debt into your mortgage and paying that debt off over 30 years. That’s a lot of interest to pay over 30 years for a simple purchase at the local groceries store. Don’t be fooled by this term! Always conduct a thorough research on any debt relief option before making any decisions. Your financial future can very well depend on it. Call Practical Debt Relief to discuss your debt relief help options and let one of our friendly debt counselors guide you today.
Debt relief by liquidating assets:
While probably the quickest debt relief choice, the truth is that not too many people have the luxury of this option. If you have a ton of gold lying around or properties ready to sell for quick cash then this option may be the one for you. However, the reality is that anybody who has these types of assets available probably doesn’t have a serious need for debt relief in the first place. Before making any decision on liquidating prized belongings or assets you should contact a debt relief specialist to help determine what choices are most beneficial for you.
Creditor debt relief or (Hardship) program:
The creditors have become keenly aware of the fact that consumers are getting the education necessary to fight back during this financial crisis. In order to maintain their exuberant profit margins they have come up with a so-called “Debt Relief” program of their own. An in house debt relief program of course. They offer to reduce your interest rates or in some cases eliminate interest all together for a period of 3–6 months, giving you the chance to get back on track. The problem with this is that it’s a set up to keep collecting money while setting you up for failure. After 3–6 months they increase your interest rates again and you find yourself in the same position as before but with a little less funds and less will to continue the battle against the mounting debt load. Don’t wait for this to happen to you! Pick up the phone and speak with a debt relief specialist for a free debt consultation.
Debt Relief FAQ’s
Q: How do I know when to start looking for debt relief help?
A: If you find yourself just making the minimum payments on your credit card cards each month or have begun paying for everyday living expenses with your credit card rather than cash, it’s probably time to consider credit card debt relief services.
Q: Is debt relief considered the same as debt consolidation?
A: No. In a debt relief program you pay back less than what you owe* and in debt consolidation you pay back the entire balance at a reduced interest rate. Very often consumers are confused about the different risks associated with these 2 very different debt relief options. That’s why its important to consult with one of our debt consultants to determine which program best meets your needs.
Q: How long does it take to complete the debt relief program?
A: Completion of the debt relief program varies depending on many different factors including program length, debt amount, monthly budget, hardship reason, and additional monthly contributions. The majority of consumers complete the program within 12–36 months*. One of the first things we do at Practical Debt Relief is take a detailed budget to get a more thorough understanding of what your needs are.
Q: How much debt do I have to have in order to qualify for debt relief?
A: In order to qualify for the debt relief program you must have a minimum unsecured debt amount of $ 10,000. In some cases however, we will accept debt amounts as low as $ 5,000 if the consumer has a very good hardship reason. We also can only extend the program for a total of 12 months or less when an individual has such a low debt amount. Please consult with a debt specialist for more information.
Q: How do I know if my creditors will allow me to participate in this debt relief program?
A: While most creditors will always claim that they will not participate in a debt relief program the truth is far different. As time passes and the creditors continue to not receive payments they will become more and more desperate to recover lost funds. As the accounts near charge off status the creditors will take a pre-determined bottom line percentage amount in order to clean the debt off of their books.
Q: Are monthly payments made to my creditors while in the debt relief program?
A: No. Monthly payments are made into a separate third party account that we set up for you in your name upon completion of your enrollment package. Once an appropriate amount of funds accumulate in this account we will negotiate your debts one by one until you are completely debt free.
Q: Do you report to the credit bureaus that I’m in a debt relief program?
A: Absolutely not. Debt relief or debt settlement is the only debt relief program in which neither the creditor nor the debt settlement company reports your involvement to the credit bureaus. For this reason debt relief has become a popular option for consumers seeking assistance in making their finances more manageable.
Q: Does participating in a debt relief program affect my credit?
A: The trade off here is very clear and comes with a certain price. In the initial stages of the program your credit score can drop by as much as 100 points or more due to the lack of payment history as regular monthly payments are not made to the creditors. Your FICO score is made up of many different factors and your payment history is only about 1/3 of that. As time passes and we settle your accounts your credit score will slowly begin to repair itself.
Q: What are my responsibilities while enrolled in debt relief?
A: During the course of the debt relief program the creditors will continue to communicate with you by mail. In order to properly negotiate we ask that you share all correspondence you receive with our staff to ensure an efficient process. It is also the responsibility of the client to make all monthly payments on time and for the scheduled amounts. Completion of the debt relief help program is entirely dependent on client’s ability to maintain consistent payments.