It is no secret that debt can be very stressful and can invade many areas of your life
. And there are a number of credit card companies that are being ruthless when it comes to dealing with their customers. The bottom line is if you have debt, your choices are limited. If you don't and your credit card company does something you don't like, you can tell them to take a hike. The best thing to do is to put a plan in place that will no longer have you dependent on credit cards.
If you are one of the many American's that has debt, it should be one of your goals to reduce or eliminate that debt. There are a number of options for paying off your accounts and moving forward, but they are not all the same and becoming financial free is not a one size fits all process. You should take a little bit of time to figure out will best suit your financial needs.
If your debt is old and has not had payments made on it several months or you absolutely have no way of being able to pay the total balance, debt settlement may work best for you. It is important to realize that this option is not credit friendly, because your balances are being settled for a lesser amount. You will also have to pay taxes on any amount over $600 that is forgiven. This alternative will have out of debt in 12 to 36 months. Settling your debts is something you should be on your own and not by using a debt settlement service. They can be very expensive.
Credit counseling is a good alternative if you can make a 2% payment on your unsecured debts, but are concerned about it taking you several years to get out of debt. This plan consolidates all of your unsecured debts into one account and you will make one payment each month to the organization and they will pay your lenders. This option is more credit friendly and takes about 3 to 5 years.
Credit counseling is a good place to start if you are unsure of what will work best for you. They normally have access to both debt settlement and bankruptcy alternatives.
Outside of a debt consolidation loan and filing bankruptcy, debt settlement and credit counseling are the 2 methods of debt relief that offer the best choices for dealing with your debt and moving forward with your life.