Credit Cards

With the economy going through a slow period and more people than ever dealing with foreclosure, people have begun to seek debt help through other sources. Some of these sources will be kind to your credit and some will not. There are two primary types of debt reduction and counseling programs. The first is consumer credit counseling and the second is debt settlement. You do not have to own a home or be credit worthy to use either of these programs. These options are both designed for individuals who are experiencing financial difficulties and are looking for a way out.

Debt settlement is a debt reduction program and what this means is through this program your credit card balances are reduced. Your creditor is making an agreement to settle for less than the total amount owed. With this being said, you can actually resolve your debt quite quickly with this method. But many creditors are not willing to make settlements unless they believe that is their only chance of seeing any money. This usually means that you have not made your payments for 3-6 months. Any time you are paying less than we you have charged and you haven’t made payments in 3-6 months, this will definitely have a negative impact on your credit.

A credit counseling organization will help you take inventory of your outstanding unsecured debts and they will also help you get setup on a budget so that you have the money to pay those bills. More credit counseling agencies are also offering debt settlement as an option also. Unfortunately, not everyone is in the financial position to be able to pay back everything that they have outstanding on their credit cards.

Debt settlement-this is a program whereby a debt counselor negotiates a reduction on the balances of your debts. Your debts are reduced on average from 30-50% and as much as 85%. Debt settlement can save you a lot of money and can have you out of debt in 12-36 months, but this does not come without a price. It will have a negative impact on your credit. This is a good alternative to bankruptcy and works if you have debt over $10,000 and debt that is over 3 months past due.

There are some programs that will allow you to enroll with as little as $2,500. I am not saying that everyone that has that amount of credit card debt should enroll. It should be based more on your debt-to-income ratio, but it is there if you need it. A debt management plan can have you on your way to becoming debt free.

Looking to find the best deal on free credit card debt relief, then visit www.debtmanagement1.com to find the best advice on credit card debt counseling for you.