Consumer Debt Solutions

Less than a year ago, there were thousands of airline workers, bank workers, and factory workers that were making a decent living.  Today, many of those same people are living under bridges and hoping for a magic, consumer debt solutions call on their cell phone.  Unfortunately, there are no statistics available to detail how many of these people enrolled in debt settlement programs (Incharge Debt Solutions, Debt Snowball Method, Christian Debt Solutions) that gave negotiate advice. If you are going to try these programs, it is vital to look for their weak points.

Basing Payments and Plans on Your Current Income

As you may be aware, America has lost jobs for six straight months in a row.  At the same time, the rising cost of living plus taxes is sapping the strength out of businesses and consumers alike.  Chances are, the snowball of job loss and lackluster consumer spending is likely to get much worse.  Even if you currently believe your job is secure, it is bad advice to make plans on having that income throughout the course of any debt settlement program.

Rolling Unsecured Debt into Secured Debt

Chances are, many homeless people today had tried to roll their credit card and car loan debt into a second, or even third mortgage.  Many debt managing specialists claim this is the right course of  action because it will reduce your short term interest payments. On the other hand, when you have only one creditor, it is horribly easy for them to foreclose, as well as seize all of your assets. 

Therefore, you will not have an opportunity to negotiate, let alone use bankruptcy as a debt settlement tool.   Even though unsecured debt comes with a higher interest rate, you can still try to negotiate with each creditor.  Among other things, if you seek the assistance of a lawyer, they will be able to make sure that your creditors cannot harass or stalk you.  Your lawyer will also help you understand the Fair Debt and Collections Act, as well as some other rights.

Lack of Health Related Considerations

In the past, many people sought debt counseling in order to obtain relief from debts related to terminal or other forms of catastrophic illness.  While the current mortgage crisis has the attention of many people, medically related debts may soon rocket past these issues.   Among other things, as the environment becomes more polluted with carcinogens and other poisons, people are developing serious illnesses at an early age.  At the same time, the cost of medical care is being grossly inflated because medical professionals must bear the egregious expenses associated with HIPAA compliance, as well as paying malpractice insurance.  

If your counselor presents you with a solution that does not include the management of future medical issues, you could find yourself sick on top of being homeless and jobless.  As may be expected, no solution will be perfect.  That said, rather than opt for consolidation based strategies, you may want to ask about finding ways to settle your debts one at a time.