According to a recent study, the total amount of debt held by the public in the United States was estimated to be around 14.3 trillion dollars. Credit card debt alone was estimated to be around 747 billion dollars, and that’s not even counting medical bills, personal loans, and other types of debt. To put this into better perspective, the average household owes somewhere around 130,000 dollars in total debt.
Regardless of how much total your household owes, managing debt can be a very difficult process. A steady increase in cost of living combined with rather slow income growth has trapped countless people from the cycle of debt. Fortunately, there are plenty of ways to make debt easier to manage. With help from top-notch debt relief consultants, a debt relief program may be the best option for you.
CreditAssociates is a shining example of this type of expert firm. We are an agency that’s committed to helping the average American overcome debt by reducing total amounts owed by our clients to financial institutions. Using a combination of debt counseling, payment planning and good relationships with credit institutions, we are able to help nurse the finances of our clients back to good levels.
What is a Debt Relief Program?
A debt settlement program includes decisions that aim to relieve the pressure of debt on an individual. Where balances are re-negotiated by professionals to come up with easier payment terms, debt settlement aims to significantly lower the total amount of money that you owe.
How Does Debt Settlement Work?
It depends on how the debt relief agency approaches debt settlement and how it minimizes the effect of interest rates. Here’s a quick rundown on common debt relief programs and how they help get people out of their debt faster.
- Debt Negotiation – debt negotiation involves paying your creditor directly but under new terms. In this arrangement, you enlist the services of a debt relief agency to communicate with your creditor on your behalf. They’ll inform the financial institution that you’re having trouble paying your dues and payments may be missed moving forward. To avoid delinquency, the creditor will be asked to forgive a significant percentage of your debt. In return, they will receive a one-time payment via lump sum of the remaining balance. This may seem too good to be true but it actually works for a lot of people. Creditors would much rather recover at least the principal amount owed rather than chasing after you and having the debt written off if you go bankrupt.
The chances of reducing and clearing your debt will still boil down to how well you stick to the program. If you need help in managing your money to make sure you settle your existing balance, then getting debt relief advice from professionals could help you escape the cycle.
To learn more about debt relief solutions and how to start living with financial freedom, contact CreditAssociates for a free consultation or use our Savings Calculator to see how much you could save.