debtconsolidationconnection.com

Debt Consolidation: What Route is Best for You?

For some people, the Great Recession is just a jumble of statistics. For Jeremy – who was "downsized" from his job last year – it's a tragedy that has jumbled his life.

Jeremy is hard-working and college-educated, but he hasn't been able to find work. Today, he can't make the minimum payments on his credit cards and is constantly hounded by debt collection agencies. Bankruptcy seems to be his only option.

Or is it?

Bankruptcy Should Be a Last Resort

Thanks to hard times, more and more Americans like Jeremy are buried in credit card debt, car loans and mortgage payments. According to the Federal Reserve Bank, 40% of households are spending more than they earn, and the average household has credit card debt of almost $10,000!

If your situation is similar, you may have drained your savings, and could be using new credit cards to pay off old ones. You may even be thinking of filing for bankruptcy.

If so, stop! Bankruptcy should be your last resort.

Three Self-Help Options

Instead of filing for bankruptcy, consider these self-help options:

• Develop a Budget. Subtract all your "fixed" costs – like housing, utilities, food, insurance, etc. – from your earnings, and cut the amount you spend on non-essential things such as restaurants, movies, vacations, etc. Use the money you once spent on non-essentials to pay off your creditors faster.
• Money Management Techniques. You can also read books, take classes or buy computer software to help you create a budget, balance your checkbook and pay down your debt.
• Get a Debt Consolidation Loan. Banks, credit unions and other lending institutions may give you a debt consolidation loan, so you can combine all your debts into a single debt, with an affordable monthly payment. But if you have a bad credit score or owe too much money, you may not qualify for the loan.

The problem with self-help methods is that many people don't have the time and the skills to do complex financial calculations. And they almost never have the influence to negotiate better repayment deals. Also, even the smartest people get confused about the true cost of loans that have variable interest rates, loan points and "hidden" fees.

Contact a Debt Consolidation Company

For these reasons, many people are turning to debt consolidation companies. Among the best are the non-profit company that design customized solutions for their clients.

If you don't have the time or skills to create a realistic budget, negotiate with your creditors, or keep pace with growing stacks of bills, contact a company that offers debt consolidation services.

Most offer debt management plans through local offices, the Internet or by telephone. According to the Federal Trade Commission (FTC), they "can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and debt management, and budgeting. Counselors discuss your entire financial situation … and help you develop a personalized plan to solve your money problems."

Many credit counseling companies also offer you a free consultation to discuss your specific situation.

Debt Management Plans

If your problem is severe, your credit counseling organization may have you enroll in a debt management plan (DMP). With a DMP, you deposit money each month with the credit counseling organization, which pays your debts on a schedule that is negotiated with your creditors.

A successful DMP requires you to make regular payments, and could take four years (or more) to finish. Ask your counselor how long the plan will take, because – depending on your situation –you may not be allowed to apply for (or use) additional credit while you're in the plan.

A DMP offers the same benefits as a debt consolidation loan AND these bonuses:

• The company may be able to arrange lower interest rates and have certain fees waived by your creditors. This will reduce your overall debt.
• The debt consolidation service will contact creditors and collection agencies, so they will stop harassing you.
• A good debt consolidation service won't try to squeeze more money out of you because you have a bad credit history.
• A good DMP will help you create a long-term budget and teach you money management skills, so you're less likely to get in trouble again.

Contact Debt Consolidation Connection for a Free Consultation

Don't let embarrassment keep you from turning your life around. The certified professionals at Debt Consolidation Connection will help you dig out of debt as quickly and painlessly as possible.

At Debt Consolidation Connection, trained and certified professionals will develop a debt consolidation program to help get you back on your feet. Many clients will see reduce interest rates, extend payments over longer periods, waived penalties and other fees, and stop letters and phone calls from collection agencies.

And because Debt Consolidation Connection is a non-profit and educational credit counseling organization, we will provide you with skills and tools to help you stay debt free and make your financial goals come true.

Best of all, your consultation is free!

Take back your financial freedom. Just fill out the short form above, or give us a toll-free call at 877-209-2225. One of our professionals will contact you ASAP to discuss the best solutions to your problems.

As the poet Ralph Waldo Emerson once said, "A man in debt is so far a slave." So, don't wait to dig yourself out of debt!

Debt Management Program: Online Enrollment

Our Online Enrollment Program allows you to sign up for the Debt Management Program without the assistance of a credit counselor. It's an easy online application in 6 simple steps.

Who should consider auto-enrollment in a debt management program?

1. If you are familiar with debt management plan (DMP) benefits, policies and procedures
2. You determined that a debt management plan is the best solution for you based on your current situation and you have already completed a budget plan.
3. You are comfortable with "online applications" and have high-speed Internet access.

Before enrolling in a debt management plan (DMP) you should have exhausted all other options to re-pay your debt. While DMP's can be a good options for some, these plans are appropriate not for everyone. Make sure you really need to enroll in a DMP. DO A WRITTEN BUDGET PLAN. If it's possible to cut expenses and pay extra towards your debt, maybe you don't need the DMP. Review all other possible options to pay your debts such as home equity lines of credit, borrowing from 401k or retirement fund. Another possible option is an increase in income. Perhaps an increase in pay at your current job? Perhaps a second job. If you have exhausted all other options, then a DMP may be a good solution. Remember this auto enrollment process is designed only for consumers who have fully evaluated their situation and have pre-determined that a DMP is the best option for them.