Did you know that the average debt - for a Texan is more than $95,000 as of 2023? Some of that is due to home mortgages with 23% of Texans having a home mortgage. Another interesting fact is that the average credit score of consumers in the state of Texas is 695, which places it right in the middle — 26^th among all 50 States.

All this makes Texas one of the most affected States with respect to debt, which increased by 5.4% between 2022 and 2023. Many a Texan consumer feels squeezed by the cost of living and the increase in housing loans. As a result, they may require debt relief assistance to help get out of difficult financial situations.

Thankfully, Texans facing high credit card payments now have many ways to help manage and reduce their debt, such as debt settlement, a debt management plan, debt consolidation loans, and debt relief programs. With the help of professional debt relief experts from ClearOne, Texas residents have a viable solution to escape from excessive debt.

So, how can people in Texas get debt relief? This article explains consumer debt relief services and how people can benefit from them to become debt-free

Debt Consolidation

Debt consolidation loans roll existing debts into a single loan with one monthly payment. If you have unsecured debts like credit card bills, medical bills, and other debts, you can pay off debt by rolling it into one loan and simplify your debt management options in Texas.

Debt consolidation makes a debt management program simpler and may lower the interest rate. An average credit card often comes with double-digit interest rates. Debt consolidation can roll credit card debt into a loan with lower interest rates overall.

Keep in mind that debt consolidation does not actually reduce the total debt. Instead, it makes repayment more manageable and can help you eliminate the total interest paid over time.

Credit Counseling and Debt Management Plans

Credit counseling agencies in Texas may provide financial education and help create debt management plans (DMPs).

A DMP consolidates your debts into one monthly payment without taking on a new loan. Monthly payments are then distributed to your creditors by the counseling agency. These credit agencies often negotiate a lower interest rate and may even waive their fees to find debt relief plans and make paying off debts easier. Most credit counselors will negotiate their client’s best repayment terms with the hope of getting paid.

Debt management programs are helpful for those who wish to make payments based on their income but need structured guidance and support to manage their personal or business finances.

Debt Settlement

Debt settlement is based on the idea that a card debt relief professional negotiates with creditors to reduce the total amount of debt owed. It allows individuals to pay off their obligations with either a lump sum or negotiated monthly payments that are less than the full balance. Debt settlement typically provides 25% to 50% debt reduction, depending on the initial level of debt and the borrower’s financial situation.

This approach can provide important debt relief solutions and help avoid bankruptcy. If you are in debt in Texas, ClearOne offers services to negotiate on your behalf, aiming at reducing your overall debt burden.

Here is how debt settlement works.

Assess Financial Situation

The debt relief company helps evaluate total debt to credit card companies, income, and expenses. They will determine if debt settlement is a viable form of debt relief.

Stop Using your Credit Cards

It is important that you do not use your credit cards during the course of the debt settlement program. While you are in the program, you will deposit funds into a savings account each month for the purpose of accumulating enough money for settlements.

Negotiate with Creditors

Once enough money has accumulated in the savings account, the debt relief company begins to contact your creditors to negotiate either a lump sum offer or installment payments.

Reach Settlement Agreements

Once the creditor has agreed to a settlement offer, the settlement terms will be outlined for you so that you can make a decision on whether or not to accept the offer.

Make Settlement Payments

Once you accept an offer, the funds in your savings account will be used to make settlement payments and to pay program fees. .

Monitor Credit Reports

Once the debt has been settled, borrowers should check their credit reports to verify that settled debts are reported accurately. They should be marked as "settled" or "paid in full."

Rebuild Credit

It’s now time to rebuild your credit score after settlements are completed. To do so, all you need is to practice good financial habits, such as making timely bill payments and keeping a low credit utilization ratio.

Balance Transfer Credit Cards

For those with a good credit score, balance transfer credit cards can be an effective way to manage debt.

These cards typically offer a low or 0% introductory APR period for the first 6 to 12 months. You can transfer high-interest debt and pay it off without accruing additional interest. If you can repay the debt within the zero-interest period, you will have benefited from an interest-free repayment period.

Bankruptcy

When other debt-relief options are insufficient, bankruptcy may be considered.

Texas residents may have access to Chapter 7 and Chapter 13 bankruptcy.

Chapter 7, or liquidation bankruptcy, involves selling non-exempt assets to pay off creditors, which often leads to debt discharge.

Chapter 13, or reorganization bankruptcy, allows for a repayment plan over three to five years while keeping most assets.

Bankruptcy provides a fresh start but has long-term impacts on credit and is typically considered a last-resort solution.

Choosing the Right Debt Relief Option in Texas

Texas residents have several debt relief options available to them. Selecting the appropriate one depends on your financial situation, the amount of debt, and your long-term financial goals.

Texans facing overwhelming debt should consider taking advice from a financial advisor or credit counseling agency to explore these options and develop a tailored plan for debt relief. At ClearOne we have professional debt-relief specialists who can advise you on the best solution for your situation.

Debt settlement offers a viable solution for debt reduction, especially for those unable to manage their debt through regular payments. Our Debt Specialists will explain the advantages and drawbacks of such an option, including the fees and the impact on your credit score.

Contact a ClearOne Certified Debt Specialist today at 866-481-1597 to take back control of your life and pay off debt faster. Get a free estimate today and enjoy a brighter financial future and a debt-free life!

Texas Debt Relief