Debt Consolidation Or Debt Settlement,

Debt Consolidation or Debt Settlement, We are a country in debt. Bankruptcies are at a record high. Consumers these days are searching for a way out. There are several options. One is a debt consolidation loan. There are many debt consolidation programs out there that can help you if that is the route you choose to follow. A debt consolidation loan is simply adding all your unsecured debts together and making one payment to pay them off.

These are most often used for credit card debt consolidation. One thing you need to remember withdebt consolidation is that you still owe the same amount of money. Its just a way of perhaps paying a smaller interest amount on the total. Credit card use is at a record high.

Consumers credit card balances are through the roof. Our economy has been slow, so many people have been using their credit cards not for luxuries but for food and utility bills. This is a situation that can be dangerous for the average person. When you are only paying the minimum payment on your balance each month, you will never pay the balance off.

This is where debt settlement comes in. When you use a debt settlement service, you are negotiating with your creditors for a smaller payoff balance. The debt settlement company negotiating that is. You pay them a fee for their services. They in turn try to get your companies to settle with you for sometimes pennies on the dollar.

This allows you to pay off the smaller balances and get out of debt. There is a steep price to pay on your credit report however. It will be noted that you did not pay as agreed and this will affect your credit score. It is a better alternative to bankruptcy however. Bankruptcy should only be a last resort. It is reserved for those with crushing amounts of debt and no ability to pay them.

There have also been many changes in the bankruptcy laws which you should become very familiar with should you decide to look into bankruptcy as a resolution. There are several routes that one can take when looking to resolve debt issues. They are: debt consolidation, debt settlement and bankruptcy. You should use caution when taking out an equity loan on your home because you are essentially trading unsecured debt for secured debt and if you are unable to make the payments, you could lose your home. Debt consolidation will have the least negative impact on your credit score and should be the first option you look into.

Make sure that you write down what the minimum payment is on the credit card at this moment because it is the credit card minimum payments which go down as the balance goes down. Don’t keep using your credit cards or you will never get out of credit card debt.

Until you have gotten control of this situation the cards stay at home. Every month when your credit card statement arrives make sure you pay off the minimum payment to be able to get the balance down and eventually you’ll find yourself in control again. If at any time you find that you have some income which came about unexpectedly use that to pay off your smallest credit card balance and this will greatly reduce your overall credit card debt.

You can then opt to roll the minimum payment from your paid off credit card onto the next credit card on your list and keep doing this as you pay off your credit cards. This will get you through your credit card debt dilemma much quicker. Just whatever you decide remember that you need to keep some non-credit card funds around in case an emergency comes up and you need ready cash. Keep an account of how you are doing and see that your credit card debt is slowly being reduced.

Credit card debt today is a bigger problem than it has ever been, and this is because there are many people who are using credit cards for reasons that they should not be using them for. If you are just looking for a quick fix for financial situation, credit cards are not the answer, and this is going to get you further and further in the hole and not fix the situation at all.

There are some simple keys to getting out of credit card debt, and if you really want to eliminate this problem in your life, then you will follow these guidelines and see how easy it actually is. A great way to consolidate your credit card debt is to apply for a credit card that has 0% interest and low fees on balance transfers.

You want to transfer as much debt as possible onto the credit card that has the lowest interest rate, and then you want to begin to pay off that card. Once you have that specific card paid off, you can move on to your next credit card that has the lowest interest rate and begin to pay that one off. By using this process of elimination, you can easily get out of credit card debt without having to sit here and ponder how you’re going to do it with difficult ways that make no logical sense.