Credit Card Debt Relief - Why Bankruptcy Should Be Your Last Option For Debt Relief

Online, August 31, 2010 (Newswire.com) - Credit card debt continues to be one of the biggest problems facing the American public. Lending standards over the past decade have been downright irresponsible and now consumers are left searching for credit card debt relief options.

Some consumers who are experiencing a significant financial hardship might assume that bankruptcy is the best option. This might have been the case before 2005 however the new laws that were passed have made filing bankruptcy much less advantageous for the consumer. Ch. 7 bankruptcy (or the fresh start bankruptcy) is extremely difficult to qualify for unless you are completely insolvent and have no income coming in. The most likely scenario is that you will qualify for Ch. 13 bankruptcy which basically reorganizes your debt but this will negatively affect your credit score for at least 7 years. There are better options for credit card debt relief.

Debt settlement, or debt negotiation is a viable alternative to filing bankruptcy. Most consumers use a 3rd party debt negotiation service to contact and negotiate a debt reduction deal with their creditors. In 2009 the average debt settlement deal was negotiated for 50% of the balance. However, not all consumers who attempt to settle their debts are successful. Getting a successful debt settlement deal largely depends on the performance of the debt negotiation company.

The credit card debt relief market used to be littered with shady debt settlement companies. However new laws passed by the FTC on July 28th 2010 have made the debt settlement process much more legitimate. These debt relief companies can no longer collect upfront fees. This means that consumers who enter into a debt settlement program will not have to pay a dime until their debts are actually settled. The risk has been taken out of the hands of the consumer and put on the back of the debt settlement companies.

The easiest way to locate legitimate debt settlement companies is to use a Free Debt Relief Network . These networks will ensure that the debt settlement company you are provided is legitimate and is a respected member of all the regulatory commissions such as The Association Of Settlement Companies and the BBB. Most free debt relief networks will provide a free debt consultation to help the consumer determine what debt relief option is most appropriate. There is no magic bullet to get out of debt however debt settlement can a good option for consumers who are experiencing financial hardship and have at least $10k in unsecured debts.

To locate legitimate debt settlement companies through a free debt relief network check out the following link:

Free Debt Relief Help