Anyone dealing with overwhelming debt feels the pressure from a growing financial hardship. When it comes to choosing the right debt relief option, many people can feel lost. With several choices available, how do you know which is right for you?
A Closer Look
One of the most underutilized tools for debt relief is credit counseling services. Credit counselors can teach you about your debt relief options, strategies for getting out of debt on your own, tips on how to become a better money manager and ways to avoid problems with debt in the future. Their range of services is a great first stop in the search for debt relief.
Debt negotiation is an option that people often consider for resolving their debts. Many creditors are willing to work with you to lower your payments, remove penalties for missed payments and even amend your account conditions, such as the interest rate. However, most creditors will play hard ball, making it appear as they are unwilling to help. This is the reason that many people walk away from negotiations and seek help elsewhere. Further, even if your debt negotiation is successful it is unlikely to provide you with immediate relief from collections, or stop the threat of liquidation.
Debt consolidation is often attractive because of its promises to roll all your debt payments into one, lower payment. However, many people often run into problems with consolidating their debts. The interest rates on the consolidation loan are typically much higher than the rates on your individual accounts, costing you more in the long run. Also, people tend to accumulate more debt on the accounts that were paid off by the consolidation loan.
Although not commonly sought as a first line of defense, bankruptcy is a great tool for many people facing the consequences associated with debt. The risk of foreclosure, wage garnishment, and increased financial pressure of not making ends meet can all be managed well in a bankruptcy case. Each person carries a unique financial situation, which makes it important to consult with a lawyer about whether bankruptcy is right for you. Contact a Cincinnati bankruptcy lawyer to help you review all of your debt relief options before making the move into debt relief.