The Benefits of Credit Card Debt Relief

Done right, settling debts with your creditors can help you avoid bankruptcy and, over time, set you on a better financial path.

Here are some of the benefits of credit card debt relief.

What Is Debt Relief?

Debt relief –  which includes debt settlement – is a financial strategy wherein you negotiate with your creditors to accept a payment of less than what you owe to resolve your credit card debt. Pending creditor approval, you fork over a fraction of your balance and the remainder is forever forgiven.

Benefits Of Debt Relief

It’s true: there are some unscrupulous lenders out there who are ready to pounce on your situation and exploit it. Some of these businesses are outright scams, and you should be wary of them. Having said that, some consumers stand to benefit from debt relief.

Here’s why.

Avoid Bankruptcy

The main reason people opt for debt relief is to get out of filing for bankruptcy, a solution that lives on your credit report for a decade. Not only that, but loan, job, and credit card applications sometimes ask whether you’ve filed for bankruptcy. By contrast, getting credit card debt relief at or a similar firm only remains on your report seven years, and there’s no public record of your having settled your debts.

Stop Swimming in Debt

If you’re seriously having difficulties repaying what you owe, debt relief may benefit you. After you’ve negotiated and paid your settlement, you’re basically free of obligations in less time and at less expense than if you attempted to clear your debts using a conventional repayment schedule.

Another thing is that creditors understand that they will get even less – if anything – in repayment if you file for bankruptcy than if you settle your debt. That is why creditors accept settlement offers from some people.

Repay Your Debts Quicker

If you’re working with a solid debt relief program, you will likely repay your debts in two to four years – much less time than you’d spend repaying your debts the traditional way.

Expert Help

Another benefit of using debt relief is that you’re dealing with professionals. As a consumer, you may not be privy to all the options available to you and what they entail. You tried things your way and, for whatever reasons, that didn’t work out very well. Why not let the experts have a go?

Increased Self-Esteem

You’ll no longer feel like a failure in life after you’re regained control of your finances. In fact, you will likely be eager to do more to put yourself on solid financial ground. In turn, your relationships will probably improve and become more peaceful when financial woes are no longer a part of your everyday life.

Next Steps

If you plan to go ahead with debt relief, make sure you pick a reputable provider. It’s a good idea to contact your state’s attorney general and local consumer protection agency to see if there have been any complaints lodged against companies in which you’re interested. A reputable company will operate transparently and have many favorable reviews online.

Beware of red flags that could signal to you that a company is looking out for its own interests – and not yours. Warning signs may include upfront fees, guarantees to eliminate all your debts, and claims that the company can stop debt collection calls or lawsuits.

Now that you know the benefits of credit card debt relief, you can assess your financial situation and see if the financial strategy is one that work for you.


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