When You Should Seek Help to Get Debt Relief

Used car salesmen get a bad rap, but that doesn’t mean you can avoid purchasing another vehicle your whole life. After all, used car salesmen provide a useful service when you need something to drive at a lower price point. The same thing’s true for debt relief services.

If you’re in over your head financially, you may not know how to find reputable debt relief services. We’re taught not to discuss money or even ask for help to get out of debt, but why is that? Many people hoping to get out of debt would benefit from going through an experienced debt relief service or company.

If you suspect you might need professional help, getting expert guidance can speed the process up and cost you less. Finding someone who’s trustworthy can help transform your financial situation and put you on a solid path towards debt-free living.

Most Americans Struggle to Pay Their Monthly Bills

First, there’s no reason to feel ashamed about needing help to get out of debt. Being in debt — even significantly so — is not particularly unusual for Americans, especially due to the ongoing pandemic. The Federal Reserve says household debt increased the most in Q2 of 2021 since 2007, right before the Great Recession. In addition, 78% of delinquent debt is now “seriously delinquent” (or 90 days past due) — to the tune of $316 billion.

As a result, bankruptcy debt consolidation, debt resolution/settlement services, and credit counseling are now simply a fact of life. It helps to be educated about when these options may be right for you.

Situations That Call for Consulting a Professional Before You Can Get Out of Debt

Let’s review a few examples where you should seek professional debt relief or declare bankruptcy:

1. Your monthly minimum payments only cover interest, not any principal on the total amount you owe. In this situation, you’ll never resolve your debt without drastically changing something. It’s time for you to figure out a debt relief that fits within your current budget. Many people who find themselves in this scenario consult with a debt relief specialist to learn about alternative repayment options.
2. You’ve had a sudden life change — widowhood, divorce, or both household earners becoming unexpectedly unemployed — that drastically impacts your income. But it isn’t just drastic life changes that make someone a good debt relief candidate. In fact, if you owe more than $10,000 in unsecured debt, now is a good time to seek professional help. A local expert can help you sign up for assistance programs that could potentially reduce your monthly bills. One such program is the federal low-interest mortgage refinancing option for homeowners. Unless you talk to someone about options to get out of debt faster, learning about these programs can be difficult.
3. Student loans comprise most of your debt, so bankruptcy alone cannot help you. Since you cannot discharge these loans through bankruptcy, there’s no clear-cut path for you to quickly get relief. The good news is that credit companies often prefer debt incurred through a mortgage or for educational purposes. However, high monthly payments can be overwhelming, particularly if you’re under-employed or supporting dependents.
4. You have significantly more unsecured debt than available financial assets. Unsecured debt includes credit cards, medical bills, or personal loans that aren’t tied to your financial assets, known as “collateral.” A debt relief specialist can walk you through various repayment options, including discharging unsecured loans through bankruptcy.

Bankruptcy May Also Benefit Many Consumers Seeking Debt Relief

There are definite benefits from declaring bankruptcy, including:

• Halting foreclosure on your home (if applicable)
• Reducing your total outstanding debt amount
• Less day-to-day financial stress
• Repaying what you owe much faster (e.g., in less than five years instead of decades)

As with any financial decision, we recommend researching your options thoroughly before committing to any debt relief plan, bankruptcy petition filing, or credit counseling service.

Ready to see if you may qualify? Complete your free online bankruptcy case evaluation now!