| Product |
Services |
Costs |
Clients |
Notes |
|
Debt Counseling
|
Debt counseling agencies (also called credit counseling agencies) negotiate with your creditors using pre-set agreements and spread your payments over a longer period in order to reduce the monthly payment.
|
A one-time enrollment fee plus a monthly
fee. |
People who need assistance paying off
their debts and who can’t qualify for a loan. |
There is no obligation or fee for reviewing your case with a counselor. Note: Be aware of the rates and terms of this service before you sign up.
|
|
Debt Settlement
|
A process where you pay an agency to negotiate directly with your creditors to agree on a reduced balance/payment amount that will satisfy the debt in full.
|
Usually a percentage of the debt amount (10-15 percent) plus an initial fee.
|
People who have a large amount of debt and who already have damaged credit from multiple delinquencies and negative records. Borrowers who cannot or do not want to file for bankruptcy.
|
Working with a debt settlement company can result in damaged credit from numerous late payments and collection records. Usually taxes must be paid on the forgiven debt. Consumers should fully investigate the practices, reputation, and costs of working with a debt settlement company before signing up.
|
|
Delinquent Tax Consultation
|
Tax consultants will help you deal with tax debt problems such as liens and penalties. Provides assistance in negotiating with the IRS.
|
A flat fee: $50 or more, depending on your situation.
|
This service is designed to assist people with complicated tax issues who require professional advice.
|
No-obligation tax savings quote online. Confidential service. This service can be expensive depending on your needs.
|
|
Debt Consolidation Loan
|
A personal loan can provide you with up to $15,000 for consolidating your debts. Lower interest rate than a credit card.
|
Your loan's interest rate will be calculated based on the amount you borrow, your credit standing, and national rates.
|
People with multiple debts that they want to consolidate into one lower interest loan. Borrowers with good or excellent credit.
|
Free loan quote. To qualify, your bankruptcies must be discharged by at least 2 years, you must have a median credit score of a 580 or higher, and you must have a clean repayment history for a significant number of months.
|
|
Mortgage Loan Modification
|
A mortgage loan modification expert will work with your lender to change the terms of your existing loan and lower your monthly payment.
|
The retainer cost is typically equal to one or two mortgage payments. If your modification is not successful, some or all of your payment can be refunded.
|
Homeowners who are have unfavorable mortgage terms, owe more than the home's value, are in financial hardship, or are currently delinquent on their payments.
|
Receive a free evaluation to see if you are a good candidate for a loan modification. The modification process usually takes 30-90 days.
|
|
Bankruptcy
|
A legal process that allows a borrower
in financial distress to eliminate or reduce debts through
a court filing. |
$250 - $2,000 for an average filing. |
People with an overwhelming amount of debt that they cannot pay back. Bankruptcy may be necessary if your income has been reduced, you have large debts, and/or you are being sued by creditors.
|
Get a free consultation with a local attorney to see if bankruptcy is right for you. Bankruptcy records remain on your credit report for 7-10 years and are very damaging to your credit score.
|
| Other
debt options to consider… |
|
Do-It-Yourself
Debt Reduction
|
Use our article and worksheet to
create your own debt reduction plan. |
There’s no cost. |
People with a manageable amount of
debt who are organized and dedicated to paying down some of their
debts each month. |
If you need help creating a reduction
plan and staying on track, you should work with a debt counselor
instead. |
|
Credit Card Balance Transfer
|
Transfer your high interest rate debts to a credit card with a low or zero percent APR.
|
Your creditor will determine your interest rates based on your financial data. You may have to pay an annual fee or balance transfer fee.
|
People with debt who have good enough credit to receive a credit card offer with a low rate or zero percent introductory offer.
|
Opening a new credit card account can have a negative effect on your credit in some situations. It is important that you fully understand the rates and terms of the account before your proceed.
|
|
Borrowing from a Family Member
|
Asking a trusted relative or friend to lend you the money you need to pay your debts.
|
Hopefully your relative will charge little or no interest on this loan.
|
People who have access to financially-stable relatives or friends and who know they can pay back the debt quickly.
|
Borrowing from a friend or relative can put a great strain on your relationship. Trouble could surface if you are unable to pay back the loan in a timely manner.
|
| Non-payment of Debts |
What would happen if you just decided
not to pay back your debts? |
$20-$40 late fee per missed payment; dramatic interest rate increases; collection agency interest rates and fees; repossession of property; possible judgment, wage garnishment, or lien.
|
This is not a good option. |
Not paying back your debts can lead to significant credit damage for 7-10 years. Your debts can be charged-off, sold to a collections agency, or collected through legal action.
|
