Debt relief, also known as debt settlement or credit negotiation, is a method of reducing the amount of unsecured debt that consumers owe. It is a two to three-year process that can result in the consumer leaving debt behind and establishing a good financial standing.
If you have debts that are preventing you from living a healthy and secure lifestyle, it is important to seek help from a trusted and reputable debt relief company. The right partner will negotiate with your creditors to get them to accept a reduced payment or even completely erase the debts on your behalf.
The first step in a debt relief strategy is to tally up all your debts and figure out how much you can afford to pay each month toward them. Then, you can take a look at your budget and cut back on expenses that are not helping you reach your debt reduction goals.
One option is to pay off the highest-interest rate debts first. This is often called the snowball method, and it can be a very effective strategy for reducing the amount of debt you owe.
Another option is to work with a nonprofit credit counseling agency or file for bankruptcy. This will give you the breathing room you need to make progress in a more timely manner and avoid getting into trouble with your creditors or losing your home, car, or other assets.
A third option is to use debt-focused technology to tackle your debts in a more efficient way, using state-of-the-art apps to automatically handle payments and even raise your credit score. These types of programs can also be a great way to start building up your savings for the future.
It is important to choose a debt settlement company that is accredited by independent consumer and regulatory organizations. These organizations ensure that debt relief companies have met a set of rigorous standards and have an excellent reputation in the industry.
In addition, it is a good idea to check with the Federal Trade Commission before you sign up for a debt settlement program. The FTC has recently created new rules that require debt relief providers to disclose vital information before enrolling consumers in a program, including how long it will take to obtain results as well as the fees they charge.
The Federal Trade Commission’s guidelines are designed to protect consumers from scammers and shady companies. A reputable debt settlement provider will adhere to these rules and not make false claims about its services or the outcome of its work.
When choosing a debt relief company, it is important to do your research and read reviews. A reputable company will offer a free initial consultation and have a reputation for helping people with their debts.
It is also a good idea to look for a debt settlement company that has extensive experience and strong relationships with creditors, attorneys and collection agencies. These types of relationships allow a debt relief partner to negotiate better results than a novice who has never done this before.