Debt Recovery Solutions

Debt recovery solutions is a buzz phrase for ways to get out from under a crushing mountain of borrowed money that has left a family or individual unable to pay for all of life's bare necessities and the debt as well. Answers for getting out of this burden are often provided by books and pamphlets that a consumer can get at a local library. But they also can be gleaned from talking to a credit counseling service which can offer debt recovery solutions that make a profound difference in a person's life. Credit counseling services, sometimes referred to as debt recovery services work with most credit and loan providers to craft a plan for its clients to pay off debts within five years. Within the standard plan created for each client, a credit counseling service has specific action plans to reduce a consumer's debt as quickly as possible.

One strategy from debt recovery solutions companies is to negotiate with lenders to lower interest rates down to very low levels in order to facilitate speedy payoffs. When a credit card company or other creditor receives a call from a credit counseling service, the company knows that the client has already been thoroughly vetted by the counseling service. Issues such as the number of late payments, depth of debt on each account and income level have already been worked out ahead of the call to the creditor. It then becomes the job of the counseling service to negotiate the lowest possible interest rates so that the client's overall monthly credit payments are cut by at least forty percent. And don't think that the creditors aren't willing to do so because they know that the principle plus a little interest is a whole lot better than the debtor defaulting on all the money owed! Mr. Marley does have a heart after all!

A second strategy from debt recovery solutions experts is to maintain the level of payments every month. With a credit counseling service, a workable, single monthly payment for all debts is established at the beginning of the process and so each month the client sends in money to the counseling service which then takes about ten percent for its own profit and sends the rest along to the various creditors. One of the reasons for the success that counseling services can have runs counter to what the typical bill payer will do. Take Mr. Never Do More Than You Have To. This guy is the one who takes his grocery shopping cart to the parking lot corral, but only puts in the front two wheels. As soon as an account of his is paid off, does he take the money he had been paying on that paid off account and put it on another account as payment toward the principle? No, he is off looking for a way to spend the extra money, and so do many other debtors as well.

Unlike our Never Do More Than You Have To friend, the secret to debt recovery solutions counseling is that when the initial account is paid off, the monthly payment doesn't drop. Instead, the extra money starts being poured into another account as an extra payment on principle. As the months and years roll along, the same monthly payment provides more and more money for the principle on each account until, within five years, all the debt is gone. When that load is lifted from a person, it can be a glorious feeling. Another glorious feeling is when we know that God has forgiven all of our sins, past, present and future. "Therefore, if any man be in Christ, he is a new creature; old things are passed away: behold, all things are become new." (II Corinthians 5:17)

The third strategy from debt recovery solutions providers is to pay a little extra every month beyond the minimum payment. If a person pays just the minimum payment on revolving charge cards, the earth will have entered a new geological age before pay off. Did you know that paying an extra house payment each year can drop a thirty year fixed mortgage down to twenty one years? It's amazing what paying a little extra on any loan can do to shorten its life! So debt recovery solutions providers can do amazing things for their customers. But it doesn't come without a price and it's not the monthly 10% charge.

Chapter thirteen bankruptcies are legal proceedings in which the debtor doesn't want to default on any of his loans, but does want to have the payments stretches out over a longer time so the monthly payments are not so crushing. Chapter thirteen bankruptcy means that a debtor will not have to lose any assets and that is a good thing. Chapter thirteen bankruptcy means that a person can escape the guilt that often comes from walking away entirely from his debts, which is the format of chapter seven bankruptcies. Does any of this sound vaguely familiar to debt recovery solutions? The one thing that a credit counseling service will probably not stress enough is that when the solutions that have been talked about are applied to a person's debt, the result is a black mark on the credit report almost as dark and negative as a chapter thirteen bankruptcy would be. Credit counseling services may be the only solution, and it may be a stigma that one will have to bear for a number of years, but the scar does go away eventually and life goes on.

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