subject: You Have Several Options in Reducing Debt Fast [print this page] You Have Several Options in Reducing Debt Fast
What may seem insurmountable now can be turned into a reducing debt fast plan with the right help. While you can talk with creditors and develop a money strategy on your own, you should really consider talking with a professional debt counsellor. After all, you got into money trouble all on your own so getting help to get you out can be a smart move for your financial future.
What a Counsellor Does for You
A debt counsellor's job is to be professional and straight up honest with you. They will examine your current lifestyle, money choices, income streams, debt load and more. Your counsellor will point out to you all the holes in your financial management plan and help you basically device a new one. Sometimes, it is a matter of tough love but they will always be sympathetic to your plight and present potential solutions that will benefit you the most.
Debt Options
If you are meeting your financial obligations but simply have no way to save money, your counsellor may propose a debt management plan which includes contacting the creditors on your behalf to lower interest rates, changing due dates or even settling the debt for a lower amount. An informal arrangement like this is not necessarily court ordered but it does show your creditors intent to pay following a plan more advantageous to your financial needs.
Your counsellor may talk to you about an informal voluntary arrangement (IVA) with your creditors. Reducing debt fast could be achieved through this option and it is legally binding. Basically, your counsellor or an IVA Practitioner intercedes on your behalf to get the creditors to agree to a payment plan that fits your budget. Once an agreement is reached by both parties, interest charges, letters and phone calls from the creditors stop. While this avenue may affect your credit rating, it is still a much better option than bankruptcy and allows you to honour your financial obligations.
Debt consolidation may be proposed if you still have a decent credit rating and can quality for a loan which will lump all your creditors together and pay them off. With this option, you end up paying a lower interest rate which means a lower payment. The life of the loan may be longer; however your counsellor will have given you the tools to follow a budget which not only allows for saving but also a guaranteed debt pay-off after a specified length of time. Consolidating is the best option when you are fiscally responsible but just plagued by badly structured debt.
It is much harder to find ways in reducing debt fast when you try to do it yourself. That is why, with the help of a professional debt counsellor, you will realise true financial relief much quicker.
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