What is the Best Debt Relief Option for You?

If you are tired of debt and the limitations it imposes on your life, you need a plan to radically alter your financial situation. Here are some of your debt resolution options:

  • Do It Yourself debt reduction
  • Debt settlement plans (DSPs)
  • Credit counseling and a debt management plan
  • Bankruptcy Debt consolidation loans

We know that choosing the optimal method of debt relief can seem overwhelming, especially when you are already dealing with the stress that debt causes. That's why we recommend that you speak to a ClearOne Certified Debt Specialist, who will help you determine which of these options suits your particular needs.

Here's a brief overview of what each type of debt relief involves.

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Do It Yourself Debt Reduction

You may be able to reduce your debt on your own if:

  • You have a steady income.
  • You are current on payments.
  • You can pay more than twice the monthly minimum on your credit cards.

Through the Snowball Method, you go after the credit card with the smallest balance first, while paying the minimum on the other credit cards. This way, you retire one card at a time. The Avalanche Method requires you to retire the credit card with the highest interest rate first.

The advantage of DIY debt reduction is that it does not hurt your credit score and it does not cost anything beyond what you owe plus interest. The disadvantage is that you may find that you are not making real progress toward your goal of freedom from debt. In that case, you can always consult with a ClearOne Certified Debt Specialist to analyze your situation and explore other options.

 

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Debt Settlement Plans (DSPs)

Debt settlement plans are often a good option for people who owe more than $10,000 in unsecured debt like credit cards. If you are struggling to make the minimum monthly payment on credit cards or are making little to no progress in paying off the principal amount of debt you owe, a debt settlement plan can help you get back on track.

When you choose a debt settlement plan with ClearOne Advantage, we do all the heavy lifting for you. Here's how it works:

4-steps Debt Settlement

  • Settles your debt for less than you owe: With a ClearOne Advantage DSP, creditors often agree to accept less than you actually owe.
  • No upfront fees: Unlike some other forms of debt relief, there are no upfront fees. Fees are collected only after ClearOne successfully negotiates a settlement with your creditors.
    Can include unsecured debts other than credit cards: A DSP can address many different types of unsecured debts, meaning that you can handle most of your debts with one plan and one monthly deposit to your escrow account.
  • The escrow account belongs to you: The FDIC-insured account is under your control for the duration of the debt settlement process.
  • Be free from debt in 2-5 years: Generally, ClearOne clients are able to be free of debt in as little as two to five years by making all scheduled deposits and following a customized DSP.
  • DSPs have an excellent track record for getting people out of debt: According to an American Fair Credit Council report, debt settlement saves $2.64 on average, for every $1 you spend on fees.

  • Some creditors may not settle: Many creditors will reach an agreement with you, but some may decide not to accept your settlement offer.
  • Negative effect on your credit score: Debt settlement will have a negative impact on your credit report, but not as severe as bankruptcy.
  • Tax consequences: You may have to pay additional taxes on the money you save through debt settlement.

Learn More How Debt Settlement Works

We know that finding relief from debt and taking back control of your financial life requires both determination and commitment from you. However, our clients’ past success has proven that you can conquer your debt.
 
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Credit Counseling and Debt Management Plans

Credit counseling/debt management is a form of debt consolidation that may work well for people with $5,000 to $10,000 in unsecured debt. It allows you to bundle multiple credit card debts into a single package, making a single monthly payment with lower interest rates and possibly forgiven penalty fees.

Credit counseling may have a slight negative impact on your credit score, and there are some upfront fees as well as monthly management fees to consider.

Learn More

 

Bankruptcy

Bankruptcy should be considered a last resort for those who can see no other way to free themselves from debt. A successful bankruptcy filing creates an automatic stay that protects you from creditors for the duration of the process.

Filing is complicated, however, and working with a bankruptcy attorney is usually required and there will be fees involved. Even if your bankruptcy filing is successful and you are able to discharge some or all of your debt, the severe impact on your credit score lasts for 7-10 years.

 

Is Bankruptcy the Right Option for You?

If you are like millions of Americans struggling under the weight of credit card debt, you may feel that your life has spiraled out of control. You can take control back by exploring your options for credit card relief. One smart option to consider is debt settlement.
 
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Debt Consolidation Loans

Debt consolidation loans aim to replace your multiple, high-interest credit cards with a single, low-interest loan. This way, they consolidate your monthly payments into a single payment under more favorable terms. These loans may be suitable for people with excellent credit.

Debt consolidation loans feature payment periods of 36-60 months. The main danger of “paying off one debt with another” is that you may feel tempted to start using your paid-off credit cards again. Another danger is that, because some debt consolidation loans are secured, you risk losing assets you use as collateral for the loan if you default on your payments.

 

Learn More About Debt Consolidation Loans

If you feel like you are constantly worrying about how to make your next credit card payment, you are not alone. Around 80 percent of Americans struggle with debt. You do not have to be an extravagant spender to find yourself in this position.
 
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Is Debt Relief Right for You?

A ClearOne Advantage Certified Debt Specialist can help you to determine if debt settlement is the right option for you, as well as help you put together a customized solution to fit your financial situation. Defeat your debt the smart way. Find out how.

Start Your Journey Today

I advise anyone out there that may need help in the debt reduction area to really try ClearOne Advantage. You will not be disappointed!

- Ange, Punxsutawney, PA