Options For Repaying Your Debt Quickly
What Are The Fastest Ways To Get Out Of Credit Card Debt
The most rapid debt repayment program available is debt settlement. Through negotiating with your creditors, it is possible to pay off your debt in as little as 12 to 30 months with a settlement company. Other than bankruptcy, which can eliminate your debt immediately after you file, debt settlement, also known as debt reduction or debt negotiation, is also the least expensive debt solution. Despite all the advantages of settling your credit card debt, there are some downsides that should be considered prior to enrolling in any service. For one, unless your credit is already very poor, debt negotiation will most likely affect your credit score negatively. Another disadvantage is results do vary, so any reputable company will never offer a full guarantee to reduce your debt by a specific percentage. To learn more about debt settlement please fill out a form and we can match you directly with an expert for a free consultation.
The second fastest debt resolution option is credit counseling. A credit counseling program can reduce your interest rates and help to reorganize your debts. In some cases, a counseling organization can manage to get late fees, over the limit charges, and other credit card fees waived to make paying down your debt easier. As with debt settlement there are disadvantages associated with credit counseling. In general, however, it is considered a far less risky avenue for satisfying your financial debt obligations.
I know that if I miss a payment on my mortgage, my home will be foreclosed. What can the credit card companies do to me if I become past due?
The credit card companies have much different leverage (undoubtedly much less leverage, we might add) in terms of collecting a debt. The first remedy available to them is also available to the mortgage companies – reporting your delinquencies to the credit bureaus. The second remedy is charging you late fees, over the limit charges, and increased interest charges. Normally these first two steps are enough to convince most consumers to bring their accounts current. Other than that, however, the credit card companies also have the option to pursue you legally through a debt collection law firm to collect the full outstanding balance. Typically this is a last resort for mort credit card companies, since doing this is costly, timely, and oftentimes results in the consumer filing personal bankruptcy. However, if the debt collection lawyer does in fact pursue a legal judgment against you and wins, they can garnish your wages, levy your bank account, or put a lien on your property (typically your home).
Can I go to jail if I fail to pay my debt?
Unless it is child support or debts that were fraudulent, no. This practice was abolished in the 19th century. That being said, it is possible that if you avoid a legal order to appear in court and you don’t, you can be found guilty of contempt and the judge can order a “body attachment” be put on you.
If a creditor does take me to court then, how do they determine what they can do to collect the balance?
A creditor has three main ways they can collect the balance, which we mentioned above (garnish your wages, levy your bank account, and put a lien on your property). Before they determine which course of action they will take to get the balance owed, they will try to get information about where you work, what your home is worth, and your income. Depending on what they learn about you (if anything---many times creditors have a lot of problems finding out this stuff), they will make a decision. For example, if you have a home worth a lot of money and you have very little income, it will likely make sense for them to put a lien on your residence. While looking at your individual circumstances, they will also need to make sure they stay in line with the protections afforded by your state. For instance, some states like Texas and Pennsylvania prohibit wage garnishment entirely, so obviously that is one tactic not available to the creditors.