9 Ways Debt Reduction Programs Work

Nationwide Debt Reduction Services

For many people, reducing or paying off debt alone is not easy. The cost of simply living life is expensive. Car payments, medical bills, utility costs, and mortgage payments are common expenses people have and that doesn’t even cover other living expenses like groceries.

When credit card and personal loan debt enter the mix, trying to pay all of these bills, let alone pay them off becomes very difficult to do. If you’re someone that is facing this difficult and stressful situation, consider using debt resolution to give you a fresh start. Here are 10 ways debt reduction programs work.

It Addresses Your Accounts

Juggling the many bills that come with life is familiar to people in debt. But it becomes even harder when you get behind on credit card and loan payments. Trying to pay active accounts along with closed ones is a strain on any budget. One of the great things about debt reduction is that all of your accounts are addressed, even if they are closed. This not only makes it easy for that debt to get paid but also to ensure you have a better history with creditors when you do start fresh and have credit.

Finally, debt reduction helps with your budget because the payments you’re making include all of the accounts you want to pay, not just the ones you can afford to pay.

The Program Works for Your Situation

Everyone who considers debt resolution or decides to enter a program has a different set of circumstances. The number of accounts, type, income, and obligation level varies from person to person. That’s why debt resolution programs spend a good deal of time learning about your financial situation so that it addresses all the accounts you need help with at an affordable cost.

It’s a significant difference from other solutions like consolidation loans or credit management. While each option varies slightly depending on your financial situation, they don’t achieve the same level of personalization.

Debt Resolution Ends Minimum Payments

Obtaining a debt consolidation loan or entering a debt management program doesn’t necessarily put an end to paying the minimum on your credit cards. Taking a loan still means that you’ll be paying the minimum on your loan at the very least, assuming you’re able to qualify for one.

Debt management programs also work with you to pay down debt. However, unlike debt resolution programs, debt management programs only lower interest rates and minimum payments. Such programs have established relationships with creditors to make these adjustments.

For people in heavy debt, this does not necessarily provide the relief they need. Depending on the number of accounts enrolled, payments to a debt management program are comparable to the amount of money you’re already paying toward existing debt which means achieving resolution may take awhile.

Debt resolution services, by contrast, have payments that are determined by what the client affords and takes into account every financial obligation they have. This ensures the client actually gets out of debt and not into more debt.

No More Interest

Credit cards accrue interest with each passing month. If your credit cards have a high-interest rate and a high balance for a long period of time, very little of a minimum payment actually applies to the balance. Instead, most of it goes to the interest which does very little to pay off the debt. This is one reason why getting out of debt is so difficult and why debt resolution services help clients.

Debt resolution services resolve debt by reaching an agreement with the creditor directly or that creditor’s representative. The settlement is often for much less than your full balance, in part because it does not include interest. This is one way that debt resolution helps you take steps toward being debt-free instead of getting stuck paying minimums that don’t clear up a lot of debt.

Debt Resolution Services Resolve Debt with Your Creditors

If part of your active debt load includes closed accounts or those not paid on after 180 days, your debt on one or more accounts might have been sold to another entity. While selling debt to a third party is fairly common, there is a risk that you could fall prey to debt scams and pay money for a debt scam that ends up not being connected with your original creditor. If this happens, you’ll still owe the debt in question and be out the money.

When addressing collection agencies, it’s important to understand your rights and the tips to follow regarding how payments are made. Debt resolution services are pros when it comes to this. They will only deal with the creditors and those agencies authorized to collect on the debt and make sure actual debts in question get paid.

You Save Money On Your Debt

Adding up all of the debt you owe isn’t easy and the final number may seem impossible to get out from under on your own. When you enroll with a debt reduction service, you’ll save money on the debts you owe. Some of these debts will be settled for far less than the original balance because you will have skilled negotiators working to get you the best deal for every creditor. The money saved depends on the specific creditor. But just like the freedom from interest, a debt reduction service helps save you some money on your overall debt so you can become debt free faster.

Debt Reduction Services Don’t Require Payments Upfront

When you’re strapped for cash, working out payments for different creditors is stressful because you have to make sure you have the money and save it. Debt reduction services don’t require upfront payments. The payment for the service is taken when debts are paid off or are nearing completion. Small fees such as those for a phone payment or delivery fee are also factored into the payment you make every month.

As a result, you won’t go into deeper debt in an attempt to make payments to the service. In addition, debt reduction services work with you so that your debt is always paid first before their fees are deducted.

Debt Resolution Takes Only A Few Years

The minimum payment warning on your credit card statements tell you that it will take years to pay off your debt if you make the minimum payment and charge nothing else to your card. Add all of the accounts you pay on and you will pay on your debt for up to ten years or more. Even reaching an agreement with a creditor takes time if you have multiple creditors to pay. Debt resolution take between 24 and 48 months to complete. This means all of your enrolled accounts are paid and you’re out from under large amounts of old and more recent debt.

At the end of your time in the program, your credit will be in better shape and you’ll still have relationships with creditors, only without the debts that were holding you back.

Debt Resolution Helps You Avoid Bankruptcy

People who have significant debt and who are unable to get approved for a consolidation loan may be advised by credit counselors that bankruptcy is their only option. Bankruptcy costs money, time, and is devastating to your credit. While debt resolution does impact your credit and requires dedication and time, it’s a better option for people who have a lot of credit card debt and not a lot of money. Debt resolution gets creditors paid and puts you in a debt-free position faster without resorting to bankruptcy and courts.

Debt happens for all kinds of reasons. Most people find themselves in it because of a combination of a lack of financial awareness in their younger days and life circumstances. No matter what your reason is for being in debt, you can get out of it even if it might seem impossible. You have options. Taking advantage of an option like debt resolution is a step toward a debt-free future.

Nationwide Debt

Why 2018 Is Off To a Rocky start For Those With Credit Card Debt

Nationwide Debt

A lot of individuals have outstanding credit card debt. If only the minimum amount is paid each month, it can take 10-20 years to get completely out of debt. During the interim, the charges for interest are incredibly high. Some people choose to combine their balances on a card with an interest-free period and transfer their balances only to get hit with extremely high interest rates at the end of the period. Many turn to assistance from a debt reduction agency such as Nationwide Debt Reduction Services.

January is generally the time of year when credit card companies are competing with one another to secure debts people have accrued over the holidays. According to a survey by Prosper Insights & Analytics, the average American spent $ 967.13-holiday shopping in 2017. Many providers offered no interest for the month of January in the past to help gain new customers. This is merely short term relief and the end result leaves the consumer with unpaid balances. Unfortunately, 2018 is not off to a good start, and it already looks like a bad year for anyone with a lot of credit card debt.

Higher Utility Bills During the Winter Are Strapping Consumers

January is the time of year that provides the hottest competition among the credit card providers, but in 2018 the competition is as cold as the weather. As utility bills rise, the budget of the average consumer is shrinking.

In 2017 the average utility bill was $76.56 to $190.36 depending on the state and usage. The only two credit card providers with good options for balance transfers to assist these decreasing budgets, are Barclaycard and AA. Considering the vast number of credit card providers, this news is downright dismal.

During the month of January in 2017, new cards with excellent options were being launched by AA, Halifax, M&S Bank, Virgin Money, The Bank of Scotland, Lloyds Bank and Post Office Money. The problem is not simply the significant decrease in competition by the lenders, the deals being offered are much lower in quality as well.

The Lack of a Budget

The longest interest-free period ever offered on a credit card for a balance transfer was a staggering 43 months, and it was from Halifax. This provided a generous period of over three and a half years for the individual to pay off their outstanding balance. The longest current period with zero percent interest is 38 months. While this is still a decent length of time, it is also much shorter than it was only a year ago. One of the most significant issues is most Americans do not have a budget. According to a survey conducted by Forbes in 2017, 75 percent of all Americans do not have a budget and are unable to cover a $500 emergency. 56.3 percent have under $1,000 saved and rely on credit cards for emergencies.

The Fee for the Size of the Transfer

In addition to the significant decrease in the time allowed for balance transfers, this is not the only area that has seen changes much less beneficial for the consumer. The size of the fee for the transfer must be taken into consideration as well. Sainsbury and Halifax are currently offering credit cards with no interest due for 36 months. Halifax is charging a fee of 2.5 percent, but the fee for Sainsbury is 2.89 percent. When the balance transfer is high, the difference in the transfer fee can make a big difference in the amount of the fee. For individuals whose debt is fairly small, the better option may be a credit card provider offering a shorter period of free interest with a much lower transfer fee.

Unfortunately, many people are not going to be able to pay off their debts from 2017 and will need to contact a good debt reduction agency such as Nationwide Debt Reduction Services for assistance. There are a good number of credit cards available in 2018 with no transfer fees. It is important to understand the credit card providers offering the best deals for balance transfers have been designed for individuals with a high credit score. Unless the credit history is excellent, chances are good the applicant will be denied.

The Credit History

Prior to applying for any new credit cards, the potential applicant should review their credit history and credit score. There are lenders who enable applicants to determine their approval chances before filling out the application. If the application is denied, it will leave a mark on the credit history and may affect the credit score. The most important actions a person can take are to avoid ending up in this situation again.

Instead of using credit cards to cover emergencies, deposit funds in the bank each month to cover any potential disasters. Holiday gifts are not reliant on the purchase price, and this spending can be drastically reduced. Dining out less, watching movies at home, and refraining from purchasing the latest devices will all help to reduce the monthly budget.

Nationwide debt

What is the Best Way to Reduce The Amount of Debt You Owe

Nationwide debt

Many individuals have found themselves in a situation where they have accrued too much debt. Sometimes the debt increases substantially due to over the limit fees and late fees. This can not only make it extremely difficult to pay the debt down, but it can have a negative impact on your credit score. There eventually comes a time when your debt must be reduced. There are steps that can be taken to help lower the amount owed.

Paying Off Past Due Debts First

One of the most efficient ways to lower your debt while raising your credit score is to pay off any balances that are past due. All delinquent accounts must regain a positive balance, and past due balances must be paid first. This will additionally eliminate over the limit fees. You can also call your credit card company because they will sometimes work with you on negotiating a settlement for any past due balances. Since your creditor wants the account settled, there is always a possibility they will accept a much lower amount than you actually owe.

It is important to ensure you receive the negotiation terms you settled on with your creditor in writing prior to sending in any payment. It is a good idea to have proof the creditor has agreed to accept a lower amount. Your written confirmation should clearly explain the exact details of the negotiation and settlement.

If the settlement is extremely large, you may want to contact a lawyer or debt expert such as Nationwide Debt Reduction Services. They will be aware of any tax or legal issues in your state and will have a full understanding of the language used by your creditor in the agreement. The paperwork should state the account has been paid, not paid for a lesser amount. There are additional specific loans that will not appear on your credit report provided your payments are made on time.

The Credit Card With The Highest Interest Rate

As the balance on your credit card bill increases so does your payment. If you have multiple credit cards, paying all the minimum payments due on time can be difficult. When the payment is late there is an additional fee added, and this only increases the balance even more.

Combining all the balances on one card with a larger limit will generally decrease the total payment due, and it is easier to pay off one card than multiple balances. Whenever possible, pay more than the minimum balance to decrease the payments and balance even faster. It is imperative the cards with the highest interest rates is paid first.

The Credit Card Utilization

Paying off the smallest of your debts will enable you to pay a larger amount on your higher balances. Having too many credit cards or sources of debt makes it difficult to remain current on your payments, and it can damage your credit score. Your credit card utilization should be a maximum of thirty percent. This will help you to regain control of your finances. If you have too many debts, are unable to pay off any of them, and are unable to make the monthly payments, the best option is a debt reduction service. Nationwide Debt Reduction Services works directly with creditors to assist clients in their financial situations and are an excellent option to get out of debt.

Paying Off Installment Loans

Sometimes the issue is not with credit cards, but with installment loans. This can be anything from a new car to a new HVAC system for your home. It may be possible to work with the company that gave you the loan, but this may hinge on how long the loan has been in existence. If the loan is only a few months old, you have not yet established yourself with the company, and they may be unwilling or unable to work with you. If you have been paying on the loan for several years, your chances of extending the loan and reducing your payment are much better. Depending on the size of the loan, when it was issued, and the expected payoff date, you may be able to lower your payment enough to make it affordable.

Asking for Help

Regardless of what type of debt you have, if the situation is already out of control, you will probably require assistance. Once the balances on credit cards have exceeded the limits, and are consistently rising due to additional fees, it is difficult to handle the situation alone. If the situation is not promptly addressed, it will get out of control, and creditors will be calling you at home to demand payment. There are agencies trained to help people get out of debt, and they are very good at what they do.

 

How a Debt Reduction Service Can Help You Handle Your Debt Obligations

Nationwide Debt

Being in significant debt is overwhelming. Many people don’t know where to turn or even how to take a step on the right road to financial recovery. People who find themselves in heavy debt have the right to use debt reduction services to help clean up their finances. This article outlines what a debt reduction service does to help you meet your debt obligations.

Factors to Consider About Debt

Deciding to pay off debt isn’t an easy decision because it takes consideration, planning, and discipline. Think about the following questions when researching your debt payoff options:

Debt Size

Paying the smaller debts first give a sense of accomplishment and encourage the payments on larger debts. It also eliminates smaller payments and frees up money for larger debt.

Obligations

Look at the financial and legal obligations that must be paid first. If you can’t make these payments and all of your other payments, evaluate your monthly budget. Think about the things you can do to change that budget. It usually includes things like changing spending habits and boosting your income.

Bankruptcy

No one wants to consider bankruptcy. It is usually the method of last resort. But it is a way to get out of debt. Depending on the amount of debt and type, it might be the only way for some people. It won’t release you from all debts though, so considering every debt resolution option available is a must.

Interest

Just like smaller debts are important, high-interest rate credit cards are as well. If a high-interest rate card is boosting up your personal debt think about paying this off first.

Defining Debt Reduction

Debt reduction helps to clear away financial debt quickly. Unlike credit counseling, which helps to manage debt and spending habits, debt reduction seeks settlements from people you owe. A negotiator’s goal is to settle for a number that is lower than what you owe. If you have that money on hand, the settlement is paid for and is one less debt to worry about.

Debt Reduction, Credit Counseling, and Debt Management

It’s important to understand that debt reduction services are not for everyone. But for people in significant or heavy debt, debt reduction services provide a way to actually make progress in paying off their financial obligations.

A good first step in determining whether debt reduction is for you or not is by consulting a credit counselor or two. The consultation is free and counselors are typically certified in budgeting, money management, consumer credit, and debt management. This consult may take more than one session. Some credit counselors offer a budget and a recommendation for what to do next depending on the situation at hand. Other credit counseling services are offered in conjunction with a debt management program.

Debt management programs typically do not impact your credit score. Since they are also offered along with credit counseling services, debt management programs reduce interest rates and they give you an action plan to take. If you choose to go with the plan and enroll in the program, a debt management program takes a set amount of money from you every month and pays them out to each company.

This does not impact your FICO score. But the downside to debt management programs is that the payments are usually higher than with debt reduction. This is a defining difference for people who have a heavy debt load without enough income to pay it off.

Debt Reduction Considerations

Debt reduction is another option. Like debt management, it offers an alternative to bankruptcy. Not all debt resolution services are created equal. If this path appeals to you as a consumer, be sure to do all of your research. Find out:

  • What reviews the company has received
  • The costs involved
  • Requirements of the program
  • How long it will take to resolve your debt in total
  • The impact on your credit score

Choosing a Debt Reduction Service

Nationwide Debt Reduction Services helps consumers reduce their debt by first having a consultation with them. Like debt resolution, the representative has an in-depth conversation about the financial situation of the potential client. Based on this information, a customized plan is developed that includes a monthly payment. This payment is based on an amount the client is able to afford.

Once the client enrolls in the program, that payment is sent to a dedicated saving n escrow account every month and funds build up until they reach a level where a debt is payable. Programs typically last for 36 months but may be more or less depending on individual circumstance. Negotiators work on your behalf during this time to arrange for a settlement on your debts. Not using further credit is something Nationwide asks customers to do upon enrollment.

All settlements must be authorized by the client and once paid, the creditors may report to the credit bureau that the debt has been settled. Once the program is complete, you will be able to use credit again.

The decision to get out of debt isn’t easy. But services like Nationwide Debt Reduction Services help consumers get out of debt without resorting to bankruptcy. If debt management or DIY debt resolution isn’t for you, contact us and we’ll help you take the first step in becoming debt free.