We can provide a strategy for your financial hardship.
We can provide a strategy for your financial hardship.
Debt Relief Options
Which solution is right for you?
Are you struggling with debt? You are not alone. Millions of Americans are struggling with sky-high interest rates, stagnant wages, and unstable employment.
Will debt relief help? If you are looking for a way to resolve your debt, take some time to weigh the pros and cons of your debt relief options. The important thing to know is that there is no one-size-fits-all solution. The solution that is right for you depends on your specific circumstances. As a member of the U.S. Hardship Group Network, U.S. Hardship Group can help review your options and figure out which is best for your situation.
See some of your debt options below:
Minimum Payments – Making your minimum payments may keep you looking “decent” on paper, but you pay a heavy price: interest.
Debt Validation – We require your collector to provide validation, verification, and proof of their legal authority to collect from you. It is also known as Debt Dispute and often seen as the cheapest way to resolve your debts while avoiding bankruptcy.
Credit Counseling – If you are having difficulty paying your bills each month and need only moderate debt relief, credit counseling may help.
Debt Consolidation – The most common form is a cash-out refinance loan, using equity in your home to pay off credit card debt.
Bankruptcy – Bankruptcy debt relief is generally considered to be an option of last resort due to its harsh impact on credit and lifestyle.
Which type of debt relief is right for you?
Is it worth the wait?
It’s true: making your minimum payments keeps you looking “decent” on paper. You avoid late fees and you aren’t reported to the credit bureaus as “delinquent”, nor do you have to worry about your credit score being lowered. So what’s the catch? Interest. You pay a very, very heavy price for making only your minimum payments.
Minimum payments are how credit card companies make serious money from you. When you make only the minimum payment, a significant portion of your payment goes towards your interest or finance charges.
If you are struggling to make ends meet and only paying the minimum on your accounts, it may feel like your balances never come down. Fees and interest accumulate quickly and you’ll be paying way more than you originally owed. Not to mention, it could literally take you decades to pay off. If your debts are being reduced at a very slow pace, it may be time to seek another alternative.
Speak with U.S. Hardship Group at (877) 777-0174 about potential debt relief options.
What is Debt Validation?
Few Americans are aware of their right to question the validity of their alleged debts. Under certain federal laws and uniform banking law, or commercial code, the consumers have a right to question debt collectors who claim they are representing the lender. The debt collector must then provide proof they actually own the debt. They must also prove the consumer actually has an obligation to the debt collector under an express contract with that debt collector. If the debt collector cannot prove the validity of the debt, they have no substantial proof of claim.
Debt validation is the action of disputing presumptive claims by unscrupulous third party debt collectors. U.S. Hardship Group advocates for the People, unlike many legal representatives who charge high rates to make a deal with debt collectors which not only costs the consumer money for legal representation but causes the consumer to pay more money than the original debt in many cases. Most legal firms will tell the consumer they owe the debt. If federal law states a consumer has a right to question the validity of the debt, why are legal representatives telling consumers they owe the debt and playing let’s make a deal with your money rather than advocating for your rights?
At U.S. Hardship Group, we do not sell consumer’s rights away, we stand for them! We are not attorneys. We do not practice law. We do not give legal advice. We educate and advocate for your rights with a unique debt validation program unlike any other company out there claiming to do debt validation.
Will you benefit?
If you are having difficulty paying your bills each month and need only moderate debt relief, credit counseling may be an effective option. A credit counselor can help you set up an affordable payment plan and offer lower interest rates that have been pre-negotiated with your creditors. However, if your situation is more severe, credit counseling may not be enough to help you reduce your debt. In the credit counseling option, you make one monthly payment to the credit counseling company and they disperse it to your creditors. It is different from debt resolution because your debts are not settled for a lesser amount.
Who Credit Counseling is Best For
The credit counseling option is for those who can afford their monthly payments but are not making progress in paying down debts. They want to protect themselves from creditor collection actions and do not want to become delinquent.
Credit Counseling Pros
Credit Counseling Cons
Is it compounding the problem?
If you are making many payments every month to different creditors, you may consider getting an unsecured debt consolidation loan. Making a single payment for your debts may be more convenient, but you need to consider how much it will be costing you overall. While debt consolidation loans may offer a lower monthly payment, you could pay higher interest rates over the course of the loan. Only take out an unsecured debt consolidation loan if you are prepared to make the payments on time and in full.
Another debt consolidation alternative is a cash-out refinance. People who qualify for a cash-out refinance must have sufficient equity in their homes, strong incomes, and good credit. If you have many high interest debts and are juggling multiple accounts, this option may help you lower your monthly payments and get out of debt faster. The cash-out refinance effectively shifts several of your unsecured debts into a single, new debt that is secured by your home. Make sure to keep up with your payments though, or else you could end up losing your house.
Who Debt Consolidation is Best For
Debt consolidation isn’t right for everyone. If you don’t have a large amount of debt (at least $10,000) then consolidating might not be a good solution. Consolidation loans often require collateral, especially if you want to secure a good interest rate.
A collateral-based loan is a loan secured by an asset you own. By receiving a secured loan, you agree to forfeit the asset to the lender if you fail to repay the loan. So if your collateral is your home or your car (and it will need to be something of high value like that), then you could be in danger of losing them if you can’t pay your lender. That’s how foreclosures happen. It’s a trade-off: more risk for you, less risk for the lender, which means a better interest rate. Your home is a serious thing to put on the line, but if you’re confident that you can repay your loan and resolve your debt, it shouldn’t be a problem.
What happens if you don’t have collateral? Not everyone is a homeowner. Some lenders will offer unsecured loans. With an unsecured loan, the likelihood of getting a good interest rate diminishes dramatically. When all the lender has is your signature and a promise to pay the money back, they might be more reluctant to consolidate your debt and loan you the money. They’re essentially taking on all of the risk. A high interest consolidation loan may hurt you in the long run.
A long repayment schedule plus a high interest rate equals a lot of extra money – on top of your debt – that you have to pay. If you have collateral and can get a secured loan, that may be the way to go.
Debt Consolidation Pros
Debt Consolidation Cons
Will it all go away?
Bankruptcy is often considered to be an option of last resort. Due to changes in bankruptcy laws, it is now much more difficult to qualify for Chapter 7 bankruptcy, in which the filer is cleared of any obligation to repay his/her unsecured debts. It’s much like starting over with your financial life but the consequences are huge. You could lose your possessions because your assets may be sold to pay off your debts. Also, the bankruptcy tarnishes your credit for many years to come. Keep in mind that Chapter 7 bankruptcy does not affect most tax obligations nor will it rid you of your federal student loan debt, so if you have a balance, you are still responsible for paying it back.
Since it is harder to qualify for Chapter 7 bankruptcy, more people are filing for Chapter 13 instead. If you file for Chapter 13 bankruptcy, you will still need to repay some or all of your debts over time. The repayment plan can be worked out with the court. In some instances, your debts may be reduced but not eliminated. Once the terms have been negotiated, you will make payments to the court, and they will distribute the money to your creditors, at the direction of a court appointed trustee.
While Chapter 13 bankruptcy takes longer and usually costs more than Chapter 7 bankruptcy, the upside (for a homeowner who can work out a repayment plan with their bank) is that they can keep their house. Both types of bankruptcy will damage your credit. The decision to file for bankruptcy should not be taken lightly. The effects are serious and may be one of the biggest financial decisions you’ll ever make.
Who Bankruptcy is Best For
Bankruptcy Debt Relief: You may have tried alternatives like credit counseling or debt settlement but were not able to maintain the monthly payments that those programs require. Although bankruptcy is often viewed as an option of last resort, it might be the right choice for some people. At U.S. Hardship Group, we hope that after we review your situation, we can help you find out if bankruptcy or an alternative solution is right for you. If you are carrying more debt than you can foreseeably pay back, bankruptcy may be something to consider. Make sure to consult with an attorney before choosing the bankruptcy option.
Request a free consultation by calling (877) 777-0174 or by simply filling out the form below.
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