Do You Need Debt Relief Services? Here’s What You Need To Know


Being in debt can be a pretty scary place depending on your set of circumstances. You can feel like you are all alone and helpless to save your sinking financial future. This is not true. In these tough economic times, there are hundreds of people drowning in one kind of debt or the other, and just like you they are looking for a way out.

There is Some Hope

Debt relief services developed as a response to these challenges to help manage debt. They help people who are unable to negotiate a plan with their creditors for the repayment of those debts. Most of these credit relief services serve to either provide a plan for repaying your debts or help you manage your personal finances to deal with your expenses.

As such, there are three main ways you can be helped with your debt:

  • Credit counseling

This is basically advice on money management to help you develop, budget and manage your debt. There are several sessions that you will attend and work with counselors to develop a personalized plan for your finances. Some of these counselors are online, but it is best to get some face to face counseling if you can within your area.

  • Debt management planning

If you have a lot of debt, the credit counselor may recommend this. These debt management plans will involve the credit counselor negotiating a payment schedule with your creditors. You will then be required to deposit some amount with them to pay your unsecured debts as per the schedule.

  • Debt settlement programs

These programs are run by companies that want to make a profit, unlike the first two that are offered mostly by non-profit organizations. The company will negotiate with your creditors on a settlement amount that will be paid at once to clear your debt. You will be required to make payments to an account to accumulate the settlement amount and in that period, the company may ask you not to make monthly payments to your creditors.

But you have to Be Careful!

These may sound like great options, but before you get into any contract, you need to make sure that the debt relief service providers are legitimate. Check with your State Attorney General or consumer protection authority to see if there have been complaints about the company you want to deal with, and whether they are licensed to work.

You also need to find out how much these services will cost you. Even the non-profit credit counseling firms may charge a fee just like the debt settlement companies. Therefore, you need to know if you can afford their services.

Be sure to get every agreement down on paper. Verbal promises are only as good as the paper they are written on and are a classic scamming method for illegitimate companies. Get their contract and read it carefully. If you don’t understand it all, find someone to explain it to you before making any commitments.

You don’t have to drown in debt, but don’t be quick to grab hold of anything that looks helpful. To know more about debt relief, click on the link below.


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