Find out which debt relief program is best for you
Answer a few questions in a minute and we will tell you about the debt relief program that is best suitable for your current financial scenario. Remember, the right debt relief program will help you reduce your existing problems and make your financial life better. On the other hand, wrong debt relief program will only complicate your life.
Do you want to get rid of late fees?
Late fees: This is the extra fee you need to pay for not paying a bill on time. Late fees affect your credit score badly. They stay on your credit report for 7 years.
Do you have plans to apply for loans in the next 6 months?
Think and decide the type of loan you want to apply for. Creditors will check your credit thoroughly, be it a secured loan or unsecured one. Bad credit will make it tough for you to obtain a loan. You may need to get help from a co-signer to obtain loans.
Lower interest rates can help to simplify your payments. You may have to shell out less dollars from your wallet. This will help to accelerate your debt recovery and saving process. You can save
some dollars for rainy days.
A good credit score will always help you get a line of credit at favorable rates. The better your score, the better your financial future. Not every debt relief program will help to raise your credit score. So, think carefully.
Are you willing to compromise with your credit score a little bit and repay debts?
Before answering this question, just remember, your credit score has already taken a hit by now. Unpaid debts and late payments are already on your credit report and they're going to stay for 7 years at least. Once you pay off debts, you can finally work on rebuilding your credit gradually.
Is it ok with you if your credit score drops by 200 points?
Credit score determines your credit worthiness. A big drop in your score will lower your credit worthiness. You're less likely to obtain loans at low interest rates. Some lenders may not be willing to offer you a loan soon.
This is the actual amount you borrowed from the lender. It becomes easier to pay off debt when the principal amount is reduced since you've to pay less amount. If your principal amount is slashed from $25000 to $20000, then you'll save $5000.
Are you willing to save dollars in a trust account?
It is best to save money in a (trust account) FDIC insured bank. Once you deposit sufficient amount in the trust account, the debt relief company will negotiate with creditors and settle debts eventually. As per the FTC laws, you'll have access to the trust account. So, don't worry.
Tax debts are really bad. If you want mental peace, then try to get rid of them fast. Usually, tax debts remain on your credit report for 7 years. However, unpaid tax liens may stay on your credit report for an indefinite period.
You can't even think of selling your property when a creditor has imposed a lien upon it. Even if you sell your property, the creditor will be paid first from the sale proceeds. Suppose, a lien has been imposed upon your home. If you owe $50,000 to creditors and you sell your home at $75,000, then you'll get only $25000 in your hand. The remaining $50,000 will go to your creditor.
Okay. Your credit score is really important for you. You want to pay off creditors through affordable payments.What you need is budget counseling and single monthly payments. DMP can help you with that.
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