Chapter 7: Bankruptcy has a dramatic affect on your score, and depending on where you started from, you’ll probably end up somewhere between 520 and 550. But, if you’re careful you can raise that score dramatically so that in about two to three years, you’re in the very good to excellent range. Chapter 7 will stay on your credit record for ten years. Check out How to Get New Credit to Survive and Thrive After Bankruptcy.

Cons: Specific to National Debt Relief, it is not available in all states, so if you are one of the 16 states it doesn’t operate in, you can’t use it. In generally, there are always risks to debt relief. If you choose debt settlement or bankruptcy, it can affect your credit score. Know the risks before you decide to go forward with any debt relief program.


It is also important to be aware of any debt settlement and debt relief and elimination scams that may be going around. Always research the companies or the debt relief programs you are interested in and make sure they are offering legitimate and reliable services. Also, make sure that the debt consolidation program you work with informs you of all the risks that may be associated with the particular programs they are offering.
As a debt junkie for almost ten years, I ran up credit card after credit card living like my salary was about four times its actual size. Stupid things I bought on credit included flying lessons, weekends in Las Vegas, and a brand new pickup truck. Hey, I never said I wasn’t having fun. (Remember, I’m on the other side of 25 now, so I started college pre-recession… during the dot-com boom. Back then, I actually thought I could graduate with a sociology major and find a $75k a year job—because I knew people who did!)
Debt consolidation loans can help you pay off bills as well. They are a type of personal loan in which you can consolidate all types of outstanding debts as well as other expenses, including credit cards, other higher priced borrowing, and medical bills. The individual will take out a new loan, at a lower interest rate, and use that money to pay off other accounts. This will reduce your monthly payment, and therefore will save you money. Debt consolidation loans are just one option available to help consumers get better control of their finances.
You cannot use your existing credit cards while you’re on a debt management plan, nor can you open new accounts. McClary also said that if you do manage to open new credit card accounts during your debt management plan, existing creditors who find out may stop participating in your debt management plan and reset your account to its original terms and interest rate.
Hi everyone, in the UK we have student loans, but these are paid back through your salary when you start earning over £15,000 Gross Salary. Depending on when the loan was taken out, interest rates vary from 1-3% (so quite low). Basically if you’re not working, they cant take the money from you. Is this how it works in the US? Great site by the way it really puts things into perspective.
thankyou for the imformation it was very helpful and as of today i’m going to my up stairs and get all of my childrens toy’s and different things that are in really fair condition and start selling thing to get out of dept i’ve always been a stay at home mom i’m going to get a part time job and start doubling up on certain depts thankyou we recieved a letter from out morgage company and they told us our house payments went down and i told my husband no you still need to pay the same amount but add more money to the payments

Avoid high monthly fees. Most debt management plans charge a nominal monthly fee to cover the administrative expenses. Depending on the number of creditors you have, the monthly fee may vary, but it generally should be between $2-5 per creditor or, at most, not more than $50 per month.[7] Make sure the agency doesn't charge any other maintenance fees (i.e. an annual fee) in addition to monthly fees.
Debt management and debt settlement are two very different repayment options. A debt management plan provides regular monthly payments to your creditors. In contrast, a debt settlement program often encourages you to stop sending payments to creditors, which can result in serious consequences. The risks associated with debt settlement programs are important to understand. Below is a summary of things you should consider before choosing debt settlement as an option.
Great article. We are in the process of paying down debt, and the freedom we feel in watching that number decrease is a beautiful thing! Doing something RIGHT AWAY is key because, as your chart above shows, the greater the amount of money going into paying debt, the less you have to spend (even on the things you truly need!), so the debt pile increases and you never get out from under it. Everyone can do something NOW to see a shift in that picture. It all starts with an earnest desire to confront and change. Thanks for sharing.
Chapter 13: Most debts are discharged. Some debts that are not dischargeable in a Chapter 7 case have to be paid in full in a Chapter 13 plan. To keep your secured debts like a car loan or mortgage, you have to continue making monthly payments. There are circumstances in which you can add your car into your plan payment. You can also use the plan payment to catch up past due house payments and prevent a foreclosure.

Everyone I've talked to has been professional and courteous. They have truly helped to alleviate some of the stress of feeling like you are drowning with nowhere to turn. There didn't seem to be any daylight at the end of the debt tunnel until I spoke with the folks at National Debt Relief. Everyone is very helpful and the explanations of the process have been very thorough. I feel confident that with their assistance this program can work and I can get out of debt within a reasonable amount of time and save money in the process.
Receiving automated refund checks is great, it’s like finding money on the ground. As it turns out, stores owe you money all the time, but they don’t pay if you don’t ask. That’s where Earny comes in. They automate everything. Price drop? Get cash back for the difference. Deliveries arrive later than advertised? Get cash back. Effort required? Zero, just how we like it.
But sometimes, disaster strikes and people are forced to confront their circumstances head-on. A series of unfortunate events — a sudden job loss, an unexpected (and expensive) home repair, or a serious illness — can knock one’s finances so off track they can barely keep up with their monthly payments. And it’s in these moments of disaster when we finally realize how precarious our financial situations are.
Take one more look around the house. Do you really need a $100 a month worth of cable TV? Does paying $50-$75 for a round of golf make sense? Can you mow the yard and clean the house yourself? How about exercising without a gym membership? All those things are nice to have … if you’re not in debt. Dump them until you’ve paid off the last of your credit cards.

*Clients who are able to stay with the program and get all their debt settled realize approximate savings of 50% before fees, or 30% including our fees, over 24 to 48 months. All claims are based on enrolled debts. Not all debts are eligible for enrollment. Not all clients complete our program for various reasons, including their ability to save sufficient funds. Estimates based on prior results, which will vary based on specific circumstances. We do not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Not available in all states. Please contact a tax professional to discuss tax consequences of settlement. Please consult with a bankruptcy attorney for more information on bankruptcy. Depending on your state, we may be available to recommend a local tax professional and/or bankruptcy attorney. Read and understand all program materials prior to enrollment, including potential adverse impact on credit rating.
Global criticism of credit counseling comes primarily from predatory practices that take advantage of debtors that are already struggling.[4] These practices include failing to meet required standards, charging unlawful or unreasonable fees, failing to provide affordable solutions for consumers, and neglecting to make customers aware of free debt services available elsewhere.[5]

Not all consumers are able to complete debt relief programs for various reasons, including their ability to save sufficient funds. The use of debt resolution services could negatively impact your credit and may result in legal action on the part of creditors or collectors for unpaid balances. Consumers enrolled in debt consolidation programs who fail to adhere to the terms of their debt management plan (DMP) may forfeit the benefits of debt relief and revert to the terms of their original creditor agreements. Read and understand all program materials prior to enrollment. Please contact a debt relief specialist for complete program details.


Under no circumstances should any information from this blog be used as replacement for professional financial advice. DollarSprout.com is owned by VTX Capital, LLC and neither are licensed by or affiliated with any third-party marks on this website and third parties do not endorse, authorize, or sponsor our content except where clearly disclosed. DollarSprout.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.
It is difficult, if not impossible to gain control of your finances unless you have a budget. People think it’s too much work … until they get $20,000 in credit card debt and wonder how in the world that happened! Remedy: Develop a realistic budget that addresses financial needs like housing, food, health care, insurance and education, but still creates room to make payments on debt. Put away the credit cards and only pay with cash. That might mean reducing (or eliminating) things like dining out, entertainment, shopping for new clothes, cars or electronics, but if you’re serious about eliminating debt, operating with a budget and paying cash is a great start.
Credit counseling is done largely over-the-phone or online, but can be done in-person at a home or office. Counselors conduct 30–40 minute interviews to gather information about your financial situation. They will ask questions about income, expenses, budgets and assets. It is best to have this information documented and available when you begin the process.

It’s crucial that you monitor the statements received from your creditors each month (The creditors will not disclose this information directly to us). You should compare that information to what’s in our monthly progress report and ensure that everything matches. If anything is different between the creditor statement and what we show in our paperwork, give us a call.

It depends — is your credit in enough shape to qualify for a lower interest rate on a consolidation loan? Will you be able to make the monthly payment associated with the loan? Unlike a credit card, where you can pay the minimum, an installment loan locks you into a payment each month for a set period of time. You can also consider a balance-transfer credit card, which could help you save on interest. More info on the pros and cons of all those options here:

My daughter has major college loan debt. We have helped pay a couple of loans,but cannot pay them all. She is working three jobs,trying to get her Spcial Ed teaching degree,and is living back home with us. She will be 27 in November and feels like she will never get out of this vicious cycle.She has negotiated some of her loan’s interest rates down,but is now considering bankruptcy.is it true that you can’t file bankruptcy on student loans? This is a nightmare for so many young adults. I think that it is a major part of the economic woes in this country.


Get the answers to the most common questions on credit card bill and debt consolidation. This can be one solution to use, especially when the interest rates are lower. The process can help you decide whether taking the approach of credit card consolidation is right for you as just maybe it can help you in your personal and financial situation. Find a list of questions about credit card consolidation.
As you begin to work this system, keep in mind that it’s not easy. Just like losing weight, losing your debt takes work, but if you genuinely want to slough of that stressful debt, your perseverance can make it happen. And don’t fret if you need to make adjustments along the way. This isn’t about a quick fix, it’s about changing your habits and behaviors so you can achieve your financial goals.
A debt management program consolidates your debt without you having to take out a loan. In other words, you don’t need a loan to pay off a loan. It is administered by a nonprofit credit counseling agency like InCharge Debt Solutions, which offers financial education alongside the program so that consumers learn from the experience and aren’t likely to repeat it again.
How it works: Settlement companies ask you to stop paying the credit card companies and instead, send regular payments to an escrow account. When the balance in that account has reached a sufficient level, the settlement company negotiates with the card company for a reduced, lump-sum payment. If the creditor agrees, money is sent from the escrow account. If there is not enough money in the account, a payment schedule is agreed upon.
We offer loan facility to both individuals and companies who needs loan to finance their business ideals, to pay off their bills, expand their existing business, consolidate debts, to finance good projects e.t.c at interest rate of 3%. We also guide and render financial advice to our clients. Kindly contact us today for all your financial needs, so that we can discuss, sign agreement and then finance your project or business for you. E-mail: (barrymoreloans12@gmail.com) or you can text on this number +19725345446
When it comes to student loan debt, you might consolidate federal student loans into one loan through the Department of Education's Direct Consolidation Loans. Also, or alternatively, you might take out a private loan to consolidate debts -- that's generally referred to as refinancing student loan debt. The advantages of consolidating can include lower monthly payments (if you extend your payment period) and getting out of default, while drawbacks can include less flexibility and a longer payback period -- which can mean more interest paid, overall.
For example, when you initiate a debt management plan, you may be asked to close credit card accounts. Doing so changes your credit utilization ratio — the comparison between the total amount of credit you have available versus the amount you're actually using. Closing accounts lowers the amount of credit you have available (your credit limit), which increases your credit utilization rate and negatively impacts your credit score.
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