There are many options available to you. There may be other debt solutions in the marketplace; we list 6 main options when it comes to debt solutions in detail in the Services section.

The highlights of those options are:

1.    DEBT ROLL-UP

By paying over and above the minimums each and every month, you can greatly accelerate the rate at which your debts get paid off. Instead of taking 20 years to eliminate your debts, you can do it in 4 or 5 years with this technique.

The basic concept of the Debt Roll-Up strategy is very simple. You start by making a list of your debts and then rank them in order of their size, starting with the smallest and working up to the largest. You should always start with the smallest debt because it will be paid off the fastest using this approach. While keeping the regular minimums in force on all the other accounts, you apply everything else to that one debt.

Once the smallest debt is paid off, then you work with the next one on the list. By repeating this process, a snowball effect occurs because you will have a steadily increasing payment amount to work with each month as you go forward.

2.    DEBT CONSOLIDATION

This is a service offered by either for-profit or nonprofit organizations, who work with your creditors to lower your interest rates and help establish a repayment budget. (These programs may be called “credit counseling” or “debt management plans” or “debt adjusting plans” depending on the agency or company involved.)

Another Debt Consolidation strategy is borrowing enough money from a bank or finance company to pay off all your bills at one time, leaving you with a lower interest rate and a single lower monthly payment, or borrowing against the equity in your home to pay off credit cards and other unsecured debts.

3.    CREDIT  COUNSELING

One variation on “debt consolidation” is not really consolidation at all in the truest sense of the word. Instead, you are enrolled into a debt repayment program. You meet with a counselor who analyzes your monthly budget. The counselor then makes contact with your creditors and attempts to get them to lower the interest rate. You make one monthly payment to the agency, which then disburses the funds to your various creditors.

The theory here is that your overall payment per month is lower due to the counselor’s success at obtaining lower interest rates and more favorable terms with the credit card banks. This approach is the one most often recommended by the banks themselves, and in the financial press these debt repayment plans (through “nonprofit” agencies) are touted as the cure-all for debtors who are in over their heads.

4.    BANKRUPTCY

Frankly, for some people, bankruptcy is the only realistic option.

This is the “end of the line” for the debtor who is drowning in debt. Bankruptcy is the ultimate trump card. A declaration of bankruptcy forces all commercial creditors to cease and desist from attempting to collect the debts owed them; it stops wage garnishment, reverses judgments, and generally wipes out the debts, depending on which form of bankruptcy is
declared.

There are two forms of personal bankruptcy: Chapter 7, usually called “straight bankruptcy,” and Chapter 13, usually called “consolidation bankruptcy” or “the wage earner plan. ” The Chapter 13 approach is typically a very bad deal, because you end up paying back most of the debt over a five-year period anyway, plus you have the bankruptcy on your credit history for ten years. That\'s why it used to be that 70% of people filing bankruptcy did so under the Chapter 7 provision. But under the tough new rules, it is much more difficult to qualify for Chapter 7.

5.    DEBT SETTLEMENT (or DEBT NEGOTIATION)

The process is basically “agreeing” with the lender to take less than what is owed. An example would be if you had a “balance” of $70,000 owed and you came to a settlement of $40,000.

6. DEBT ELIMINATION

Simply put, why reduce the cancer when you can eliminate the cancer altogether?! And that’s what debt elimination is.

Getting out of debt can be easy, if you know how to do it. Many of us view debt as a necessity; we buy homes, cars, boats, toys, and vacations with it. Some even use it to buy the basics like food, clothing, and furniture. Though sometimes debt is useful, it is always dangerous and unnecessary because there is always a less expensive way of getting what you want. But rest assured that if you are in debt, there is a way out!