Consumer Debt Relief Program

Consumer Debt Relief Program

It's been proven that money issues are one of the leading causes of divorce. But married or not, anyone in debt could benefit from a consumer debt relief program.

What A Consumer Debt Relief Program Can Do For You

A consumer debt relief program is the same thing as a debt management program. The difference is in name only. And with four different kinds, there's sure to be a consumer debt relief program that can help you:

• Debt Consolidation Loan - This is simply a loan given to you to pay off your unsecured debts (like credit card debt and medical bills) all at once. However, you have to have collateral (like a boat or a car that's paid for). Sure, you still owe a lot of money, but the interest rate on the loan is so low that you can be out of debt in five years!
• Debt Consolidation Mortgage - This is for homeowners. It's basically a loan from your mortgage company to pay off all your unsecured debt, then that amount is added to your mortgage. So you get to pay off all your debt at the same interest rate as your mortgage, and you get to write some of that interest off on your taxes. Your mortgage payment does go up, but only a little.
• Debt Settlement - This certainly isn't the best debt relief program out there because it can damage your credit a little. On the other hand, when you enroll in a debt settlement program, a debt settlement company contacts your creditors to get your balances reduced by 60-80%. If your creditors agree to this, they will want their money right away, and they'll report it to the credit reporting agencies and it will effect your credit report in much the same way as a late payment would.
• Debt Consolidation - This is an option for anyone in debt. When you enroll in this consumer debt relief program, a debt consolidation company contacts your creditors to get your balances and interest rates reduced. Then they combine all the new balances and you pay the debt consolidation company one monthly payment instead of making several monthly payments to your creditors. They take care of making sure your creditors get their money, and your balance is paid off in five years.

Another benefit of a consumer debt relief program is that they usually offer some sort of credit counseling to go along with the program. Credit counseling can teach you the skills you need to budget and stay out of debt for good.

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