How to Choose the Best Method of Debt Clearance
Trying to figure out the best way to clear your debt? Debt management services offer the most effective debt clearance methods through debt management programs.
Debt Management Services
Accumulating debt is certainly a matter of serious concern. Once it happens, the biggest concern is how to pay it off. Debt clearance is not easy, especially when the accumulating amount of debt is too much to handle. In this period of economic slowdown, it is not uncommon to see more people mounting up revolving debt in the form of store cards and credit cards. Per a recent federal research report, the revolving debt of an average American was $15,788 in May 2010. Debt management services offer many effective strategies to ease your debt clearance process.
Debt Clearance Options
Does your current financial instability make it impossible for you to clear all of your debt? Well, no worries, there are debt clearance options available. You can choose a debt management program from professional agencies, including a debt settlement program. If the amount of your debt is very high, then you can even file for bankruptcy. All these methods will help you clear your debt quickly. However, each of the above mentioned options has its own pros and cons, so it is advisable to weigh the risk factors before choosing.
Periodical Debt Clearance
If you have borrowed small sums of money from various creditors, then a debt management plan will be the most effective means of debt clearance. Although it is not the quickest way, debt management service providers recommend it for gradual debt settlement. Based on your disposable income, your debt analyst might negotiate with your creditors to freeze interest charges to stop them from increasing further. According to the Federal Trade Commission, it is now a standard practice of collection agencies to distribute payments on a pro rated basis.
Debt Settlement
if you opt for this debt management program, you can settle up to 50% of your unsecured debt. There is also an extended time period of three years allotted to clear the remaining debt. If you are unable to clear your entire debt within the stipulated time period, you can ask for an extended repayment term.
Bankruptcy
If you have lost your job and are currently unemployed, then it is obvious that you will not be able to pay off your debt. In this case, Chapter 7 bankruptcy may be the only way to clear all of your unsecured debt.
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