Review of 2021 Debt Relief Programs
The first thing to tell yourself if you find yourself facing more debt than you can afford to pay off, is that you are not alone. Indeed, financial problems have plagued many people in the wake of the pandemic and the general confusion it has caused. Whether or not your dire situation is related to the global hiatus, dealing with it yourself might prove too difficult. If you mismanage the process, you could incur legal liability. Debt also seems to inevitably drain your budget, making settlement even more daunting.
The above concerns are exactly what is driving a growing number of debtors to engage in dedicated relief programs such as Stoppers‘. This article explores what is good and what is not about the debt settlement options available to people in 2021, with a focus on who is likely to benefit from which intervention.
The perils of being in debt
People who owe large amounts of money to other people and / or institutions often have difficulty paying their debt on time. The non-repayment of the amount owed can trigger legal proceedings (or less legal proceedings) involving all kinds of risks for the property and the financial situation of the person, in particular the following:
- Foreclosure. This term refers to a situation where real estate used as collateral for a loan is forcibly sold to secure repayment, which means the homeowner will most likely lose their home due to debt.
- Repossession. The word, often abbreviated as repo, refers to the self-help practice of withdrawing property you own from a debtor who currently has it, usually with a view to a future sale. This procedure is most often applied to cars and trucks.
- Wage garnishment. This means that part of your salary is withheld and sent directly to your creditor rather than being remitted to you.
- Harassment by creditors. Indeed, debtors are likely to feel wanted at times. The specific tools and practices are up to the creditor, but your overall experience will most likely be unpleasant, to say the least.
- Loss of credit score. Especially true when it comes to credit card debt, this side effect can cast a shadow over your future even after your situation improves.
Relieve the burden
The US government has introduced amendments to its Bankruptcy Code to ease the burden on the country’s citizens in debt. In particular, new sections have been included, known as Chapter 7 and Chapter 13, allowing individuals to file for bankruptcy when debts accumulate beyond the point where they can repay them.
Under Chapter 7, you are supposed to sell part of your property in order to settle the debts. This is often the most viable option for people with limited incomes, as it still avoids the losses associated with not paying off your debt. More optimistically, Chapter 13 promises to let you keep your property through a reorganization – that is, establishing a new repayment plan.
Unfortunately, filing for bankruptcy under either chapter can be complicated, especially when your financial records aren’t particularly tidy or the situation is otherwise confusing. The debt reduction companies will take care of representing you in court and gathering all the necessary papers. Ideally, experts start by analyzing your debts to find the solution associated with the lowest costs.
The benefits and costs
A debt relief program can be extremely beneficial provided it is professional. The program should be tailored to your needs as a debtor, taking sufficient account of your income and structure, expenses and other relevant aspects.
Probably the biggest benefit of quality debt relief services is that they save your time and property. By delegating your responsibilities to an expert, you will finally stop receiving calls from aggressive collectors and forget about huge tax returns. The decision also increases your chances of resorting to the best possible solution based on your situation.
Quite naturally, the benefits come at a cost. Relief is provided on a paid basis, so it is advisable to seek out a company that offers free consultation before signing an agreement. This way you will know that you can count on the professionals.