Debt Relief Options - What Is The Best Way To Handle Out Of Credit Card Debt?

Online, June 9, 2010 (Newswire.com) - Unemployment rates have been skyrocketing, home foreclosures are at record numbers and consumer debt is at an all time high. Unable to deal with all of these financial pressures, many consumers are finding themselves considering filing bankruptcy to Eliminate Credit Card Debt . But before consumers consider bankruptcy as a solution for credit card debt relief, they need to look at a few other options: debt consolidation, debt counseling and debt settlement programs.

Debt Relief Option #1 - Debt Consolidation

Debt consolidation is simply a process of grouping all of the current debts (credit cards, auto loans, mortgages, etc) into one loan. The best way to do this is through a home equity mortgage with a good rate. The problem in this economy is that with mortgage requirements becoming stricter, fewer people can qualify for a second mortgage to pay off their debts.

Debt Relief Option #2 - Credit Counseling

Credit Counseling is where consumers are able to negotiate the interest rates on their credit debt. Credit counseling makes financial sense for consumers who are able to comfortably meet their minimum payments but just want a more affordable option to pay back the debt. However for consumers who are experiencing a financial hardship and are struggling to meet their minimum monthly payments, credit counseling could do more harm than good. Credit counseling programs are notorious for being very strict and many times will kick consumers out of the program after just a few missed payments.

Debt Relief Option #3 - Debt Settlement

Many consumers that are experiencing a financial hardship and have at least $10k in unsecured credit card debt are opting for debt settlement. Debt Settlement is where consumers are able to pay back a percentage of their credit card debt and the creditor agrees to forgive the rest. This is typically the last option before filing bankruptcy. Creditors will agree to take partial payment if they believe the consumer is a legitimate candidate for bankruptcy because if the consumer were to declare bankruptcy the they would likely receive nothing. 50% of their money is better than nothing for most creditors of unsecured debt.

Debt settlement is a legitimate alternative to filing bankruptcy. If a consumer has over $10k in unsecured debt and is currently experiencing a financial hardship then debt settlement can make financial sense. To find legitimate debt settlement companies that have proven track records of settling consumer debts then check out the following link:

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