by Ben Davies
It is tough today, certainly as tough as it has been in living memory. For many there is the ever increasing problem of debt and it drags them down with higher and higher repayment schedules.

This is why the debt relief industry exists. At it’s best it can save people from bankruptcy and transform lives. At it’s worst, it is companies preying on desperate individuals to bleed them of what little they have left to give.

In this article we will look at how you can use the industry and also what you should be looking out for.

There are two main types of relief or debt management programs. The first is debt consolidation, this is when you effectively borrow another amount of money, enough to cover all the monies owed. This second loan is at a much lower interest rate and will result in just one monthly payment.

This makes an immediate impact on an individual because their new monthly payment is much lower with manageable interest unlike previously when there were many higher payments. However, people should be aware that the total amount owed increases, because there are large consolidation fees to pay to set this up.

A big stumbling block preventing people from getting these types of loans is that you will have to put up collateral as security to be accepted into a program. Most in this position cannot do that.

A second method is debt negotiation. This is when you use a specialist debt negotiation company to negotiate with your creditors to get a discount. This is possible because they use their skills and experience to make creditors understand that this is the best way to get the largest return on their money.

It can really secure very large discounts, we have seen up to 80% of peoples debts completely wiped away. It means the rest can be payed of very quickly. However, the method can impact badly on credit ratings.

One important point to consider with debt negotiation is that, you should only ever think of considering companies that charge based on what they can save you.

About the Author:
To find out more information about the debt relief industry click here or to see our list of recommendations.

Filed under: Uncategorized

Like this post? Subscribe to my RSS feed and get loads more!