Carrying an excessive level of credit card debt can take a lifetime to pay off. Balances remain high for the vast majority of people with over 95% of the monthly payments applied towards interest and fees. This is no way to live! You can quickly reduce credit card debt within as little as 18 - 30 months, if you are committed to becoming debt free.

The various options people consider when faced with such difficult circumstances include Consumer Credit Counseling (CCC), a debt consolidation loan, personal bankruptcy and negotiating a settlement. The most you can achieve with consumer credit counseling is a reduction in your interest rate. A debt consolidation loan is designed to pay back your creditors over a longer period at a slightly reduced interest rate. This path may seem desirable relative to your current situation, but this will likely take anywhere from 4 - 8 years. Should your financial circumstances weaken, you will be no better off than you were at the outset. While filing for personal bankruptcy may be unavoidable in some cases, it is a painful path to take, which will haunt the filer for anywhere from 7 - 10 years. With bankruptcy, your case file becomes a matter of public record, easily located via Internet search by future employers, landlords or creditors.

Debt settlement represents an honest and ethical alternative to addressing an unmanageable level of unsecured debt. There are many legitimate companies with trained negotiators that can obtain a settlement ranging anywhere from 15 - 50% of the original balance. All you need to do is save the amounts you were paying the credit card companies every month, letting those balances build in your own bank account. This will provide the bulk of the funds to settle, and you will, within a relative short period of time, quickly reduce credit card debt balances. Debt negotiation firms typically charge 25% of the canceled debt, which in addition to late fees and penalty interest results in settling at 55 - 60 cents on the dollar all-in!

Unfortunately it is very difficult for consumers to negotiate directly with lenders. Reputable debt negotiation firms should understand each bank’s process for handling delinquent loans and manage each situation to the client’s maximum benefit. Negotiating a settlement is not always about what you know, but often who you know. Dealing with a cooperative person can make all the difference between obtaining a settlement offer or not. Creditors and collection agencies are not going to write off thousands of dollars without a fight, so you should be prepared to persevere. In the end, you will have reduced your outstanding debt balances and regained control of your life. Negotiating settlements in this manner is the most effective way to quickly reduce credit card debt without exception! For more atricles like this: bookmark www.financedebtconsolidation.info

Author: Max Roberts

Many people turn to debt consolidation as one of the more appealing opportunities available to them in relation to debt assistance. For many individuals in the United States, debt consolidation is seen as the better option when faced with bankruptcy, a very real and disconcerting problem, especially in today’s turbulent financial state.

In recent years, the number of American citizens who filed for bankruptcy have reached two million applicants. Today’s bankruptcy laws no longer trade short-term embarrassment and up to ten years of credit concerns and difficulties for debt relief. Now, most of the people who file for bankruptcy are still required to pay off at least the majority of their debt, if not all of it. It is this fact which makes debt consolidation so much more attractive to those who are struggling financially.

Debt consolidation requires planning and discipline in order to properly apply the method and appreciate its rewards and benefits. Debt consolidation offers those who are suffering the opportunity to accomplish their financial objectives in a realistic and responsible manner, without the stigma and hardships that go along with filing for bankruptcy.

The new bankruptcy law requiring those who file to pay off all or most of their outstanding bills helps to solidify the benefits of debt consolidation for many people. These benefits often include reduced interest rates, if not reduced payments, an interactive debt repayment plan to work with, fewer monthly bills or simply one repayment obligation each month, the potential to reduce or eliminate collection calls, late fees and stress over such financial hardships, and the potential to improve one’s credit score much faster and easier when compared to bankruptcy.

Author: Hector Milla

Article Source: http://EzineArticles.com/?expert=Hector_Milla

Have you reached a point where you are paying for one credit card with another? If this sounds like you, it may be time for you to consider debt consolidation loans. Debt counselors can assist you in developing a debt management plan to help take back control of your life!

There are many benefits that you can realize by arranging debt consolidation loans. One of the best benefits of working with a debt consolidation company is that the consolidation counselors that you select will assess your current situation and create a debt management plan to help put your life back on track.

Counselors will contact your current creditors and negotiate for potentially more favorable terms to repay your debt. It is likely that your credit counselors will be able to negotiate lower interest rates which will in turn lower your overall monthly payment amount. These loans may also allow you to pay off your total debt more quickly than if you tried to manage multiple creditors.

Along with simplifying your monthly payments, you can begin to improve your credit history as debt consolidation loans can allow you to bring your multiple delinquent accounts current. A debt management plan could also help stop any collection calls that you may be receiving and also help stop the avalanche of late fees you may be accumulating.

If you are experiencing financial hardship but want to avoid bankruptcy, debt consolidation loans may be your best option. Just do your due diligence and get the best deal possible.

Author: Hector Milla

Article Source: http://EzineArticles.com/?expert=Hector_Milla

Are you unable to make your monthly minimum payments on your credit cards?

Are you late paying any of your bills?

Have you tried to contact your creditors? Have those efforts brought no solution, or a solution that you still could not meet?

Are you being chased down by creditors and collection agencies? Avoiding phone calls, and deleting emails?

Do you have a steady, reliable income stream, but it is simply not enough to make those minimum monthly payments?

Can you reasonable restructure your debt and pay it off within about 2-5 years? If you are unable to meet that timeframe, you may be better off opting for bankruptcy.

What is Credit Counseling?

In a nutshell, credit counseling is a process through which consumers are offered education about how to deal with their debt, how to avoid accumulating additional debt and often involves negotiating with creditors to create a debt management plan. A DMP is a plan in which the consumer repays their debt on a repayment schedule. Often, DMPs include the ability to reduce payments, interest rates and fees. After the DMP is created, the creditors close the consumers’s credit accounts to cut off the consumer’s ability to continue to accumulate debt with that creditor.

How do DMPs help a consumer with overwhelming debt?

DMPs can be advantageous for the consumer struggling with debt as the credit counseling agency helps to consolidate the monthly payments of the debtor into one single payment. Typically this payment is less than the sum of each of the individual payments made each month by the consumer. In fact, many consumers find that after having tried to negotiate this on their own, it is only with a DMP that the same credit card bank will now accept this lower monthly payment.  

DMPs are also helpful to the consumer as they may also achieve reduction in the interest rates they are charged by their creditors. Some consumers who are behind on credit card payments find themselves paying interest rates in the upper ranges of 20%, close to 30%! By joining a DMP, consumers can find themselves with annual percentage rates lowered to 10% or less, sometimes even eliminating the interest charges all together! This justifies the claims of many counseling agencies that their customers will be debt free in a short range of time as when the interest rates are dramatically lowered, the consumer is able to pay the debt off more quickly. Note that if you are simply looking to reduce your interest payments but you are current with your accounts, you probably should not look into a DMP as the creditors may carry that debt as "past due" in exchange for the lowered interest rate.

DMPs also help customers’ accounts that have become delinquent to a current status and help to impact their credit rating over time. This is also known as "curing" and account or "reaging" the account. The consumer making the payments dictated by the plan on a consistent basis will have these accounts reported to the credit bureaus as current. This, however, does not simply erase the past delinquencies. But with time and the continued payments with the debt management plan in place, the consumer will begin to rebuild a more positive credit history. Participation in a DMP does appear on a consumer’s credit report, and it can impact the consumer’s ability to obtain home or car loans. Some lenders will see this as a negative, as it can indicate that a consumer has not managed their debt well. On the other hand, other lenders can see it as a step in the right direction as it can also indicate that the consumer is taking care of their debt obligations and may be worth the lending risk.

Did you know that Credit Counseling is a requirement for filing for bankruptcy?

Credit counseling is now a requirement for any consumer filing for bankruptcy, as per the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. To meet this requirement, the consumer must complete a program with a nonprofit consumer counseling agency with at least one counseling session. Furthermore, they also have to complete a post-filing education credit counseling session before their debts are fully discharged.

What do I need to know about Credit Counseling Agencies and the negative statements about the industry?

Credit counseling has come under a lot of scrutiny lately with charges that consumers have paid hidden fees, excessively high fees, poor service and many other complaints. Many feel that the agencies take the sides of the creditors more often than the consumers. There are also charges that credit counseling agencies hire employees with little to no formal credit counseling training. So, you are putting your financial future in the hands of an employee who may have no more knowledge financial management than you do!

Beware of any agency that asks you to pay high upfront fees. They will claim to be "debt settlement" specialists and they tell consumers that they will negotiate their debt to "pennies on the dollar", we have all seen the ads and commercials. This is typically NOT a legitimate claim, and by the time they take your upfront fee, and the fees of thousands of others, they have enriched themselves, and preyed on consumers desperate for debt solutions.

While you may be desperate and want to hear postive, hopeful news and advice about your debt, do not fall prey to the con artists that make unrealistic promises. A legitimate credit counseling agency will tell you all of the details of how you and your credit will be impacted, even with the DMP. Make sure that they are accredited, and you can check that through the Association of Independent Consumer Credit Counseling Agencies or the National Foundation for Credit Counseling.

Do your due diligence and you can find a reputable Credit Counseling agency that will help you understand the process realistically, charge appropriately, truly do what they say, and assist you in your Debt Management Plan. This can be a viable alternative to bankruptcy, and get your on a path of financial success and security and freedom from debt in the future.

Credit Counseling Corporations and Credit Counseling Resources will offer information and updates on how credit counseling may be the right fit for you, and how you can work with a reputable credit counseling agency to your advantage.   While we do not offer credit counseling services, we will do everything possible to make sure that you can make an informed decision with the information that we provide to you.  This also does not constitute legal or financial advice.  If you are in need of legal or financial advice, it is always best to take the information you have gathered to an attorney or financial advisor for their input, interpretation and possible legal representation.