Businesses, movie and pop stars, hot shot executives and regular Joe’s all seem to be encountering the dreaded debt dilemma these days. Turbulent economic times are causing even the most money wise people to use credit more often than usual. And although the government is trying to aid its citizens during this time, in reality our government has the biggest debt dilemma of all!
With such widespread issues with debt, it is easy to become convinced that everyone is on a one way train to financial ruin. But, believe it or not, this is far from the case. Although debt may be rampant, there are answers to the debt dilemma.
Most of the time, people try and get lower interest rate from the creditor as a first step. However, often times this is very minor savings and they will ultimately have no get the benefit they need. By lowering your rate and making minimum payments, your might still get higher.
As the situation worsens and it becomes impossible to make the payments, the options of debt consolidation and bankruptcy arise. With debt consolidation you are merely buying more time. This is because debt consolidation is a means of solving debt by taking out a loan to pay your other loans off.
Bankruptcy will eliminate your debt (chapter 7) or create a payment plan (chapter 13), but the consequences of having filed for bankruptcy can be immense. Many people will not get a chapter 7 with the recent changes in the law. This leaves the option of debt settlement. Debt settlement will reduce your debts by approximately 50% and get you out of debt within 12 – 36 months.