Although bankruptcy can discharge debt, filing for one will cost money and really mess up one’s credit history.
Los Angeles-Long Beach, CA (PRWEB) June 10, 2013
With the intention of being a one-stop-site for debt relief information, Debt Consolidation USA published an article that seeks to educate consumers about bankruptcy alternatives. The whole idea is to give them a way out of debt that will not end up dragging their credit scores to the ground.
“Avoiding Bankruptcy and Getting Debt Help” was published on May 24 and it discussed two different options that prove to be quite friendly to a consumer’s credit history.
While the debt relief site does not want to completely bash bankruptcy, they acknowledge that it really has a lot of negative points. Although bankruptcy can discharge debt, filing for one will cost money and really mess up one’s credit history. Given that, the article enlightens consumers with their options.
First is snowball debt management. Debt Consolidation USA described this method as something that consumers can implement on their own. There is no need to hire a professional and spend on service fees if the consumer is not comfortable with that.
The article describes it as ranking debts with the lowest balance as the priority. In case there are similar figures, the author suggests that the one with the highest interest should be put on top of the other. The article then explains that that process involves paying the minimum for all the debts on the list and any extra will be added to the priority - which is the one with the lowest balance. Once that priority is completely paid off, the consumer should put every fund that used to be allotted for that and add it to the next debt in the list. This goes on until all the debts are completely paid off.
The article states that this usually makes consumers feel better about the debt payment progress because they get to see results. It also helps repair any damage on the credit ratings.
The next option that the article discussed is debt management. It involves hiring a debt management company who helps out consumers with their credit problems. The article states that there are charities who do this for free while others will charge a service fee.
The article then describes the process of the the whole debt relief program. The debt management company gets in touch with the creditors of the consumer to work out a monthly payment plan that they both can live with. The article mentioned that in some cases, the company is able to negotiate for a lower interest and sometimes, even debt reduction. The consumer will send funds to through the company who will use it and distribute to the creditors involved - at least, this is true for the paid services. The free debt management service is almost the same but the article states that the payment management will be handled by the consumers themselves.
The article warns that although this sound better than bankruptcy, it takes a lot longer to finish. However, Debt Consolidation USA likes the idea that the consumer is also getting DIY-debt-relief lessons and also money management.
While in some cases bankruptcy could make sense as the best debt relief option, this is not always true for everyone. Debt Consolidation USA encourages consumers to always find other options to broaden their choices.
To read the whole article, visit their website or call 1(877)610-6990 to talk to a debt relief expert.