Using a Debt Relief Program – Is It a Good or Bad Idea?
Debt relief programs are designed to provide relief to individuals and families who are in debt. This relief is a much needed relief to save most individuals from financial and emotional turmoil. If you are grinding your teeth, you will need a mouth guard such as a Sleepright dental guard, Plackers Grind No More or any other dentalguard in the market. However, if you have debt, you will need debt consolidation services.
Seeking debt relief is the not the only way to get rid of debt but it is sometimes the only way chosen by financially stressed debtors to continue with life. To an individual or family in debt, debt relief programs can be a very good idea. But yet there are a few factors which make debt relief program a bad idea for some people. Read on to analyze the good points as well as bad points of debt relief programs.
Why is a Debt Relief Program a Good Idea?
1. It is a Way to Get Out of Debt
The most obvious reason why debt relief services are a good idea is that they show you the way out of debt. Debt relief options such a debt consolidation programs, debt management programs, debt settlement programs may not help you to get rid of debt right away, but they will make sure that you are on the right track.
2. The End of Collection Calls from Creditors
The end of collection letters and multiple phone calls from creditors is another benefit of debt relief programs. As soon as you enroll with any debt relief program, your debt consultant will start negotiating with your creditor and they’ll come to know that you are paying off your debt through a debt relief program.
3. Lowers Interest Rates and Monthly Payments
You can save a considerable amount of money if you pay off your debts through a debt relief program. The debt consultant negotiates with your creditors to lower the interest rates and the monthly payments. This way you save those extra dollars on interest rates.
Why is a debt relief program a bad idea?
1. It may hurt your credit score
Debt relief options such as debt settlement programs can hurt your credit score. Since you do not pay the total amount that you actually owe, the creditors report this to the credit reporting bureau as “settled”. This may hurt your credit score considerably.
2. High upfront fees
Debt relief programs often charge high upfront fees from consumers before they even start helping them with paying off debt. Beware of such companies as they are most commonly scammers. After the new rules, debt settlement companies cannot charge any kind of upfront fees. Thus stay alert of any companies that charge upfront fees.
There are many debt relief programs that have helped thousands of consumers eradicate debt without having to file bankruptcy. So, undoubtedly debt relief programs are certainly a good idea for paying off debts. You just need to check the authenticity of the company before committing yourself with their program.
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