As the cost of living continues to rise, many Americans aren’t able to keep up with their debt payments. With interest rates so low right now, most people are taking on more than they can handle. And that is especially true when it comes to debt consolidation loans and car loans.
Many struggling Americans are getting caught in a vicious debt cycle that is only going to get worse over time. Fortunately, there are debt relief programs available for those who qualify. These programs help you pay down your debt at a reduced rate while you work on getting back on your financial feet again.
If you have struggled with credit for some time, or if you know someone who does, then read on to learn about America’s top debt relief programs
What is a Debt Consolidation Loan?
When a person is in debt, it can be difficult to make ends meet. That’s why a lot of people turn to debt consolidation loans. With this type of loan, a single loan is divided into multiple loans that are then paid back over a longer period of time.
In other words, this type of loan consolidates a person’s outstanding debt, taking it from several different creditors and consolidating it into one manageable payment. However, this type of loan comes with a high-interest rate. Depending on the person’s credit history, a debt consolidation loan could have a high-interest rate well above 20%.
Debt Settlement
If you have a lot of debt, and you have been trying to make monthly payments on it, then it may be time to consider debt settlement. Essentially, a debt settlement company will work with your creditors to settle your debt for less than what you owe.
The company will then work to get payment from you under a payment plan that is less frequent than the original monthly payment. However, debt settlement is best for people who are owed a lot of money and have no hope of paying it off. It’s also a good option if the debt has been relegated to bankruptcy, as it would be considered a voluntary payment plan. But debt settlement is not for everyone.
So, if you have a small debt and are willing to work with your creditors to come up with a payment plan, do that first. And if you have tried to make payments on your debt and you have been unsuccessful, then consider debt settlement.
Debt Relief Programs
Once you are caught in a cycle of debt, it can be difficult to get out of it. That’s why some experts recommend debt settlement. However, if you have tried to work with your creditors to come up with a payment plan, but have been unsuccessful, or if you are caught in a cycle of debt that you can’t seem to get out of, then you might want to consider having a debt relief program.
There are a variety of debt relief programs out there that allow people to make lump-sum payments to their creditors. Then, the company will work with the creditor to get the amount to be forgiven as a loan. The benefit of debt relief programs is that they help you pay off your debt, for less than what you would owe otherwise, and they do it quickly with less hassle.
The downside is that they are not ideal for everyone, and they are not for everyone. For example, if you have a lot of revolving debt, like credit card debt, then these programs probably won’t help you.
Payoff your Debt with an Offer in Excess of the Balance
One of the best debt repayment options out there is to take out a loan in excess of what you owe. With a loan in excess of the balance, you would have to pay off the loan regardless of whether you ever pay another penny on the original debt.
This is best for people who are caught in a cycle of debt and who have no hope of getting out of it themselves. And, as you would expect, this type of loan has a high-interest rate. Depending on the person’s credit history, this loan could have a high-interest rate well above 20%.
Help With Refinancing Your Mortgage
A lot of people are considering refinancing their mortgages. Particularly, those who are struggling with high-interest-rate debt and who are looking for an affordable mortgage. While refinancing a mortgage can help you lower the amount that you are paying each month, it can also have some other benefits as well.
For example, refinancing your mortgage can help you get a lower interest rate and a longer repayment period. And, it could also help you get a lower interest rate and a longer repayment period if you are struggling with high-interest-rate debt and you have no hope of paying the amount off on your own.
Help With a Home Equity Loan or Line of Credit
One of the best debt repayment options out there is to take out a loan in excess of what you owe. With a loan in excess of the balance, you would have to pay off the loan regardless of whether you ever pay another penny on the original debt.
This is best for people who are caught in a cycle of debt and who have no hope of getting out of it themselves. And, as you would expect, this type of loan has a high-interest rate. Depending on the person’s credit history, this loan could have a high-interest rate well above 20%.
There are a number of options available for people to get access to a home equity loan or a home equity line of credit. You can ask your bank, credit union, or other financial institution if they would be willing to work with you. If they are, then you can apply and get access to a loan in excess of what you owe.
Predominantly
If you’re in financial debt, try to come up with a payment plan that works for you and your creditors. This may mean going to a payment plan instead of paying off your debt in full. And if you can’t come up with a payment plan, then consider a debt consolidation loan, debt settlement, a debt relief program, or a home equity loan or a home equity line of credit.
Whatever method you choose, the most important thing is to get back on track with your debt payment. This will definitely help you get back on your feet, and it will also help you make sure that you don’t get caught in a debt cycle in the future.
