Posted on April 13, 2010 at 1:59 am government help or debt relief? which is doable if you don't have much money ?

Posted on April 13, 2010 at 2:42 am government help or debt relief? which is doable if you don't have much money ?- what do you mean by government help? and debt relief would definitely help youif you finish the program.

Posted on April 13, 2010 at 2:52 am government help or debt relief? are you employed? if you have income, it's best that you shop around for a good debt relief program and a legitimate company instead of hoping for some help from the government (which really is non-existent, as we are talking about private consumer debt here).

Posted on April 13, 2010 at 4:53 am The government doesn't have a debt relief program for consumerdebt - but you might find something here for you (benefits, aid, grants, etc.) - http://www.usa.gov/Citizen/Topics/Benefits.shtml

Posted on April 13, 2010 at 5:39 am Speaking of debt relief - the consumer can do debt settlement or credit counseling.- Debt Management Plan - Depending on several factors like, location (which state the consumer is in) - because some states restricts or prohibit professional debt settlement. The amount owed. If it is a large a amount, $10k and above, it would make sense to settle it, rather than just pay the monthly minimum, until the consumer is able to get at the principle amount of debt. If the amount owed is relatively lower, $10 and below, that would make sense. And the more appropriate program for it may not be debt settlement, but Debt Management Plan (negotiation of interest rates).

Posted on April 13, 2010 at 5:43 am I agree, and not only location and amount of debt owed. The account status plays a factor as well, in determining which debt relief program is appropriate for the consumer. If the consumer is current, debt settlement may be hard to achieve, as the original creditor would understandably prefer to collect on the full amount. The consumer paying the minimum monthly is indicative of his/her ability to pay in full - so the creditor, if ever they would settle, would settle to close to the full amount, 75% of the debt perhaps, and in one lump sum payment. Although, that's not always the case. If however, the consumer is past due, that tells the creditor that the consumer can't really afford the payments anymore - and perhaps would be willing to settle for lesser than 75%. That's not sure as well.

Posted on April 13, 2010 at 5:46 am Right, and speaking of past due - if the consumer is not able to pay for 5 to 6 months, the creditor would write off the debt (IRS mandate) - and pass the account on to a third party collection agency (which they probably own) - and get back at least portions of the debt - if the consumer settles with the collection agency.

Posted on April 13, 2010 at 5:48 am Interesting. And how much would it cost to settle a debt? What else should I know about debt settlement. Credit wise. Tax... I'd hate to be surprised in the future owing some more -after having gone through that debt settlement process. And thanks by the way.

Posted on April 13, 2010 at 5:53 am The industry standard is 15% of your total amount owed. So if you owe $10k, you pay $150/mo. That fee is spread out over 18 months. There's another structure - 20 to 25% of the settlement amount. So do ask your company about other structures. They should be able to explain that to you and if they do, that's one way of knowing if the company has your best interest at heart. You'd hear stories of people who have dropped out of the program thinking that they've been scammed all because the fee structure wasn't explained to them. Some companies would first apply your montly payments to your fee before paying the creditor/agency (whomever is holding your account).

Posted on April 13, 2010 at 5:59 am More about debt settlement - or forgiven debt - it is considered by the IRS as income, so you'd have to report it as such in your return, the creditor would send you a form, they'd also send a report to the IRS, so you won't escape the tax implication. It's best to consult with a tax person for it. After which - you're debt free. With regards to credit - debt settlement stays on your report for 7 years but not on your public records, unlike bankruptcy. And with the recent economic recession, lenders/creditors are aware that it's not such a negative thing anymore, unlike in the past.