How to Eliminate Debt - Top Debt Elimination Methods

Each person possesses different types of debt. Therefore, looking for the method that will work in order to eliminate that debt may vary depending upon the type of liability that you have since you may either possess a secured or unsecured debt.

Basically, secured debt is a loan that is being "secured" by a property; therefore the bank can come and take the property from you in case you failed to pay your obligations. On the other hand, unsecured debt is the kind of debt which is usually available in a form of credit card debt. In this article, we’ll focus more on the latter kind of debt.

Getting Rid of Unsecured Debt

Here are some processes that you can do:

1.    bankruptcy
2.    paying as agreed
3.    going for a settlement with the creditor and paying lesser than the balance due. (this method is better known as debt settlement or debt negotiation)

Among the 3, bankruptcy is seldom a feasible alternative because of the alteration created on the Bankruptcy Law in 2004 wherein people are now asked to pay back the amount as stated on Chapter 13.

A better debt elimination progam than bankruptcy:

That said; the good method that one can choose is to go through a Credit Counseling and Debt Consolidation services which is done by settling for a lesser balance due hence one is no longer expected to pay the original amount but only a portion of it. Large banks and credit companies would normally offer these services although they would normally charge an additional fee for this.

Now, the best method that one can do in order to eliminate debt is though the process of leverage. During those months when you failed to make the necessary payment, banks and companies that you have a loan with will constantly attempt to contact you to discuss your options. The thing that you must do with them is to contact them in letter and ask if they can stop calling on your phone and merely settle in writing. It is also necessary that you are aware of all your rights which is written on the Fair Debt Collections Practices Act as well as Fair Credit Reporting Act specially these days when most collections representatives would normally behave in an unscrupulous manner just to get what they want. Knowing your rights can give you the chance to fight back.

The moment when you have an adequate leverage against the company, it is exactly the right time to opt for settlement. A sensible goal must be to settle the debt for about 35%-50%. So you will be entertained better, you can contact the bank or credit card company directly instead of sending them mails and phone calls. When you visit them personally, they will have to transfer you into their collection department that will help you plan on how to resolve the debt. Normally, they will make an offer; don’t be afraid to say that you wish to only pay about 15%-25%. They may often say ‘no’ at first, but if you are persistent enough they will ask you to talk with their manager. This is a sign that you’re wish can be granted.

These are some of the top debt elimination programs you can use to eliminate your credit card debt.  Learn more at Debt Cures