When looking for debt relief, it is important to do some research to figure out which of the several options is optimal for your situation. The Internet is a great source, but always be sure to check the credibility of a particular article or website. Here is a brief overview of the major debt relief options and whom they work best for.

Debt Consolidation Loan

In a debt consolidation loan, you use one loan to pay off various other loans or lines of credit. This loan will generally have a lower interest rate, as well as a lower monthly payment. The payment you make to this loan is distributed amongst your creditors. The most common type is a home equity loan, or second mortgage, in which your home is used as collateral. A debt consolidation loan takes several years to pay off, and you pay the entirety of your debts, plus interest. This debt solution works best for people who still have relatively good credit, resulting in a lower interest rate on this loan, and have substantial equity in their home. It is best for people who are only trying to get out of debt, not overhaul their financial habits.

Consumer Credit Counseling Services (CCCS)

In consumer credit counseling services, you have new and hopefully expert eyes take a look at your debt situation to offer advice and solutions. They provide different strategies for debt solutions, and take your entire financial situation into account, rather than just your debt. While they work with creditors to reduce your monthly payments, you still pay the full amount of your debt, and credit counseling also has a negative impact on your credit rating. Keep in mind that CCCS was originally established by credit card companies to help track down people who were not paying their creditors. CCCS works best for people with less than $10,000 in debt and have verified they are working with a reputable company.

Bankruptcy

Filing bankruptcy should definitely be a last resort. The two types of bankruptcy applicable to consumers are chapter 7 and chapter 13. In chapter 7 bankruptcy, your assets are liquidated and your debts are eliminated in one quick move. Only people with low income, few assets, and a demonstrated inability to pay their debts once their basic needs are covered, quality for chapter 7. In chapter 13 bankruptcy, you set up a program through a trustee in which you pay a portion of your debts in a plan that works for you. Chapter 13 bankruptcy is best for people with high income who are facing foreclosure or tax problems. Although bankruptcy seems like a quick and easy fix for debt, keep in mind that it remains on your credit record for 7 to 10 years

Debt Settlement

In Colorado debt settlement, you take a lump sum of money, or make high monthly payments into a trust account until you have a lump sum of money, which is then used by the firm or company you are employing to negotiate with creditors. You pay a portion of what you owe and are absolved of your debts. Although it affects your credit score negatively, most debt settlement programs are completed in less than two years, meaning you are shortly able to rebuild and recover your credit. Debt settlement works best for people with $10,000 or more in unsecured debt who have a lump sum of money ready to use, or who can make high payments into an account. It also works best for people who are willing to make a commitment to long term financial change.

Because debt settlement will not work for everyone, here are a few qualities that make someone a good candidate.

• You owe $10,000 or more

• You have a lump sum of money available to settle your debts (from a friend or family member, a loan, savings, etc.), or the ability to pay a large amount into a trust account on a monthly basis to be used to settle your debts once enough is saved.

• Your debt is mostly unsecured debt, meaning there is no collateral involved. This kind of debt – credit cards, medical bills, bounced checks, etc. – work better for debt negotiation.

• You have an explanation for high debt that you cannot pay. Maybe you lost your job, faced a family emergency or death. Or maybe your interest rate was raised, or other fees were added to your debt.

• Most importantly, you have a strong long-term commitment to becoming debt free. Debt settlement is not usually a quick process, and if you are not willing to commit to financial discipline during and after your debt settlement, you may find yourself in a situation far worse than when you started.

We are not restricted to our Debt Settlement clients in the Denver Area and Colorado. Our services are easily arranged over the phone and there’s no reason why we can’t make your debt settlement program work from where we are.

Our Debt Settlement Attorney, Steve Craig has helped thousands of individuals with their debt problems be they credit card debt settlement clients, or debt settlement including all debt and many other situations and scenarios thay may adversely your credit ratings.

We don’t offer short term debt settlement loans or any other kinds of loans but we can help you figure out if any of these solutions will be good for you.

Financial stress has an immense impact on your life, your relationships and your overall well being. Let us show you the light at the end of the tunnel!

Call Steve today at 303.520.3414 so he can help you achieve the financial freedom you deserve.