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Filing for bankruptcy is a right guaranteed by the U.S. Constitution to help individuals who cannot afford to pay their debt. In order to qualify for bankruptcy filing as an individual, you must fit all of the following requirements:

1. You must have accumulated at least $1,000 in debt

2. You must be unable to meet regular payments as they are due

3. You must have stopped making regular payments as they are due

4. Your non exempt assets, if liquidated, must not provide a sufficient amount of funds to pay off your existing debt.

But just because you qualify for bankruptcy doesn’t mean that it is the best option for everyone. Filing for bankruptcy has many negative, long-term effects that everyone should know about before they seriously consider it as a solution to their debt problems.

The downsides of bankruptcy

Bankruptcy is widely considered to be the last resort option for debt settlement. While bankruptcy can provide immediate relief from large amounts of debt, it also has several negative, long-lasting effects. Filing bankruptcy can stay on your credit report for up to 10 years, making it difficult to apply and obtain credit, or to find employment and a place to live.

Filing for bankruptcy is public information, meaning the fact that you have filed bankruptcy cannot be kept private. In some places, such as upstate New York, the names of bankruptcy filers are even printed weekly in the newspaper.

Bankruptcy can also be an expensive process. Among the fees associated with bankruptcy are the costs of required credit counseling and debtor education certificates, bankruptcy filing fees, and any legal fees charged by your attorney.

What can you keep?

When filing for bankruptcy, you may be required to turn some of your property over to a trustee. This trustee will then liquidate your non exemptible assets in order to raise money to pay off your debt. You are probably wondering what qualifies as non exemptible.

The following possessions are considered ineligible for liquidation and may be kept by an individual filing for bankruptcy:

1. Necessary clothing of the debtor and dependents (up to $4,000 in value)

2. Household furnishings and effects up to ($4,000 in value)

3. One motor vehicle (up to $5,000 in value)

4. Medical and dental aids required by the debtor and his or her dependents;

5. The books of a professional, required in his or her profession

6. Tools of the trade (up to $10,000 in value) and used by the debtor to earn income;

7. Equity in the principal residence of the debtor (up to $40,000)

According to Chapter 12 bankruptcy laws, debtors who are fishermen or farmers by trade are eligible for additional exemptions. All of the values of exemptible items are based upon what price they can currently be sold for – not the cost of their replacement.

However, when faced with mounting credit card debt and the inability to make ends meet, one should not only consider bankruptcy but bankruptcy alternatives. These alternatives include such programs as debt settlement, debt consolidation & debt consolidation loans, and even consumer credit counseling. The fact is that there are many debt relief programs in existence today to help consumers dealing with debt.

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I saw a headline in the paper this morning as I was riding the train in to work. It said, “Battered Traders Tired of Hearing Recession Is Over”. And the meaning is clear: For weeks now the talk on the news has been of economists chiming in unison, “The recession is officially over” – but that hasn’t been felt by the average American.

Wall Street has gotten billions in taxpayer money to help prop itself up, but people on Main Street have hardly received a thing. Cash for clunkers? Big deal. People have been buying cars they couldn’t afford in the first place. It’s more of a cash for suckers type of program. Sorry to be so blunt. I call it like I see it.

The most that the average American has seen in the form of aid during the great recession has been the measly unemployment check that goes out to laid off workers. Let’s be perfectly honest here, if you were someone in a decent job or a very high-paid job and went from your previous salary to receiving barely over $200 a week – would you look at this as a bailout?

In any case, during these troubled times many are those who have sought to take advantage of those in need. Enter the (cough, shark) bankruptcy lawyer and debt consolidation people. They are experts in the field of honing in like vultures over the vulnerable.

The debt consolidation people are really something else. They would have people believe that there is some benefit to enrolling in a debt consolidation plan or worse – signing up for a debt consolidation home equity loan. But the facts speak for themselves.

Most people sign up for a debt consolidation loan when they are strapped with large amounts of credit card debt and are finding it hard to make ends meet. But consider this: when signing up for a debt consolidation home equity loan, the consumer is exchanging unsecured credit card debt for secured debt – debt that is secured with the consumer’s home. This is risky, risky, Risky.

If the consumer were to sign up for a debt consolidation home equity loan and then be unable to make their monthly payments at some time in the future – they could absolutely have their home seized. This is not the strategy for consumers in debt to go with.

Rather than debt consolidation and bankruptcy, consumers should consider bankruptcy alternatives such as debt settlement. Even consumer credit counseling can be effective for many. These provide a better measure of debt relief for those who are struggling in the great recession.

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Debt Consolidation

There is no shortage these days of debt consolidation companies advertising their debt consolidation programs on TV commercials. The reasons are clear: credit card debt is definitely a big issue at the current time. Even thought financial experts seem nearly unanimous that the U.S. recession has “technically” ended, there are still an awful lot of people who are suffering financial hardships and who continue to struggle.

But is debt consolidation really the answer to credit card debt? Can it help consumers reduce their debt load and greatly improve their quality of life as the TV commercials tell us? Or is debt consolidation not all it’s cracked up to be? And if so, are there better programs and better solutions to the issue of credit card debt in America today?

In order for consumers to be able to make an informed decision, they need to have a good understanding as to what debt consolidation is, and how it works. Debt consolidation is the consolidating (combining) of multiple loan (credit card) payments into one payment. This new single payment is lower than the sum of the previous multiple loans. This is achieved through lower interest rates and better payment terms.

Debt consolidation may often involve a “debt consolidation loan”. This is almost always a home equity loan. But consumer beware: a home equity loan is a secured loan. If the consumer who takes out a home equity loan as part of a debt consolidation plan they risk losing their home if they are unable to make their payments at some time in the future.

Debt Relief

What is a better form of debt relief? It is clear than when it comes to debt relief, the one program that achieves the greatest results in the least amount of time is Debt Settlement. This program works with a debt settlement company negotiating with the consumer’s creditors. The goal of these negotiations is to obtain a settlement agreement for a much lower amount than what was originally owed. Debt settlement can almost always achieve debt reductions in the amount of 50%, and very often – 75%.

Credit Card Debt

It can truly be a debilitating and demoralizing thing. The good news is that there are indeed debt relief programs that help consumers reduce and eliminate credit card debt, and in fact – kiss it goodbye, once and for all.

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Most people, if questioned about their past finances, may honestly tell you that they have had a few issues to work through, but they may not mention that a debt consolidation loan is the thing that actually helped them get through their rough patches. Debt consolidation loans are used to help those who are in a bit of a bind with their finances and have harassing creditors calling and sending letters to demand that payments be made.

It is easy to understand why one may keep getting calls for payment, but it does not make it any less annoying; the calls could possibly be stopped with bad credit debt consolidation loans and a more stable and productive financial future could be the end result.

The only things needed to change your situation for the better, are the effort it takes to do some research on how to mange finances and be willing to put it into practice.

If you are in a financial dilemma and you do not want to ask for help from family members or friends, a debt consolidation loan might be the right solution for you.

Debt consolidation lenders will not judge you or your past finances, instead of that, they will be willing to help you correct any financial mistakes that you may have made. The financial dilemma you are currently in, can be fixed and a debt consolidation loan may also improve your credit rating.

When a loan of any sort is taken out, your personal information is sent by the prospective lender, to be monitored by the three major credit agencies. The credit agencies will pay very close attention to your habits of making payment and this affects your credit rating and history, so if you make your payments as ordered, your credit score will most likely be helped.

It is extremely easy to apply for a debt consolidation loan these days, you can begin a search for the right loan at any time of the day or night by looking on the Internet.

When you use the Internet to search for the right online debt consolidation loan, the lender’s websites will provide you with a simple online loan application to fill out and receive loan quotes. The application process should take you no more than about ten minutes to complete, provided you have all of the pertinent information about the loan, nearby, to refer to. The majority of the information you are required to report on, is personal in nature, such as bill management information and banking information.

These loan sites should be secure and the way to tell whether or not it is, just look on the page for a small lock or key that is usually found in one of the lower corners on the page.

Applying for debt consolidation seems like it makes the best sense, when you are having problems with trying to dig yourself out of your financial past. This could give you a chance to begin again and your creditors will stop harassing you every day.

This is a great opportunity to re-establish your credit and gain a better financial future for yourself, so use the time to wisely research this option.

Take the first opportunity you have to apply for a debt consolidation loan and you may find that this is what you have been needing to do for quite a long time.

It is much in the news lately as people are scrambling to find ways to cope with, deal with, manage, and hopefully reduce the enormous loads of credit card debt which many Americans carry these days. If you are one of the people who are skating by and have not been touched by the recession, consider yourselves fortunate.

Debt Relief

But there are millions of good, hard-working Americans who have definitely been stung by the recession. They are in need of good, factual information pertaining to debt relief. There questions include: What is debt Relief? Is debt relief even possible? Is it real? Are there scams to watch out for? Does it cost anything? If so, how much? Can I lower my monthly debt payment through debt relief? Americans are a wise bunch and typically research as much as possible before carefully making a decision.

Credit Card Debt

It can be a degrading thing. People spend their money for instant gratification, but the bills that then follow are anything but satisfying. There is a lesson to be learned here for sure, but that’s not what this article is about. So when it comes to credit card and ways to reduce and eliminate it – just what works best?

Debt Settlement

Without a doubt, debt settlement is the one program which has proven itself most effective at providing actual debt relief to consumers. Debt settlement provides greater debt reduction and debt elimination than other programs such as debt consolidation, consumer credit, and even bankruptcy.

Total Debt Relief offers consumers a free debt evaluation which they can take advantage of at the company’s website: www.totaldebtrelief.net

Total Debt Relief has been a leader in the debt management field for over 5 years. Their consumer customers have achieved the greatest amount of debt reduction (over 50%) and the greatest amount of satisfaction possible.

According to the Consumer Credit Counseling Service, you shouldn’t have more than 15 percent to 20 percent of your net revenue obligated to pay debt. Net revenue is the actual dollars you bring home after your employer has withheld taxes. You could earn 500 dollars per week, but your net revenue is the 400 dollars amount that your paycheck is made out for and what you are able to get once you cash the check or deposit check into a bank account. So if your weekly net revenue is 400 dollars, your debt payments should take no more than 60 dollars to 80 dollars (0 x .15 or .20 = debt payment amount).

Now this doesn’t let in your mortgage or rent payment, your utility payments, your food or entertainment expenses or your savings. The debt payments we are discussing here are plainly outstanding debts that you’re required to make payments on which are above and beyond normal living expenses. Think credit card debt and furniture payments and boat payments.)

And that 60 dollars to 80 dolars is per week to decide how much you can realistically expect to be able to pay per month, you must multiply by 4.3 (number of weeks in a month) and you get 258 dollars to 344 dollars ( or x 4.3 = monthly debt obligation).In case if your debt payments equal more than 15 percent to 20 percent of your net revenue, it’s absolute likely that you should take the steps necessary to decrease that monthly obligation.

The debt reduction payments which you make every month on your credit cards or installment loan accounts include interest which is added to the principal amount that you owe each month. And so if you pay less than what the interest amount is, your balance will in reality increase rather than decrease as you make a payment.

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Debt Consolidation Video

Debt consolidation is one of the buzz words in the financial industry at the moment given the fact that levels of debt are higher than they have ever been before.

Removing the fact that the American financial system is in major debt, as is the UK government, personal debt has reached its highest level worldwide.

There has never been as dire a personal financial system as exists now on account of mounting debt, and that includes the Depression following the 1929 Wall Street Crash. It is no wonder that people are turning to debt consolidation.

Debt consolidation is effectively one single loan that is purposely taken out by an individual to cover all other loans in that person’s name.

For example, if Miss Smith has a loan with a ,000 outstanding debt and a credit card with a balance of ,550 to pay off then she would take out a debt consolidation loan of at least ,550 to cover it.

That loan would then be used to pay off those debts so that Miss Smith only had the one payment every month.

There are numerous benefits of taking out debt consolidation financial products but the main reason is to make your debt much easier to manage. If you have only one specific payment to make each month then it is much easier to make sure that you have enough money in your account on one specific date so that you can make the payment.

If you have several payments due on different dates then you are going to get in a mess eventually. Debt consolidation can solve that problem for you.

Debt consolidation can also reduce the amount you are paying every month because the loans available in that category generally have much lower interest rates, and fixed interest rates at that so you know exactly where you are. Reducing the amount you pay is always a good thing but it will help to ease the financial burden that you carry in the long term as well as the short term.

When looking at or dealing with any debt consolidation issue; it pays to do some careful research and seek help and independent support from trusted professionals.

All of the above reasons outline why debt consolidation can help you to revolutionize your finances but you do need to know a little more about it before committing.

Debt consolidation financial products are offered by most banks and financial services companies but it is important to note that some are unsecured and do not require any extra assurances but others will need to be secured against your home.

This is a precaution that many lenders are taking to ensure that they get their money back if you should ultimately default on the loan.

Now you have read a basic introduction to debt consolidation, you can see just how easy it is to understand.

You definately need to make sure that you understand every single step of the way to avoid any unpleasant surprises further down the track.

Many people have fallen victim to predatory lenders in the past through not fully understanding their financial position and rights, so make sure that you are not one of them during this trying time.

Should you try doing debt consolidation yourself?

I believe there are plenty of options for doing debt consolidation yourself. The advantage of this is gathering many small pieces and transforming them into one piece.  The interest is obviously the biggest burden that comes with the debt, and lot of people struggle to manage their multiple debts.

You know, I found myself at one point in time, 0,000 in debt, I had eighteen different debts and I had people calling me from different places.  People were also emailing me from many different place.  So as I was able to consolidate things into one different piece, it was a lot easier to manage.

What are the ways of doing it yourself?  There are a couple of different options for debt consolidation.

You can go to your bank, take out a loan, and combine four or five of your debts.  If you’ve got four or five debts, let’s say, for 0 each on a 19.99 percent credit card, you can get a ,000 loan, even if the rate is the same and you only have to do one payment.  You only have to worry about one payment at a time.  In my opinion, it is worth doing a debt consolidation this way, even if you don’t get a lower interest.

A lot of credit card companies will offer you free or low interest rate options to do transfers from that credit card.  I highly recommend you do this. Now, this is not to take advantage of these companies, but really so you can get all of your debts into one place.  It’s a lot easier to pay four or five loans at a time than it is to pay eighteen loans at a time.

Now you know the do-it-yourself debt consolidation method works, and a lot of people don’t need to get external counseling after they’re able to see all their debts in one place and to look at it one place.

The Internet is an amazing place. There isn’t much of anything that you can’t find out about on the Internet, and that includes debt consolidation and debt consolidation companies. If you really wish to know, the Internet is the spot to look.

There are numerous online debt consolidation companies. Such companies take debt consolidation loan applications online at once. They provide debt counselors to their clients, who talk to them individually by the phone. They offer precisely the same services that a debt consolidation company on Main Street will offer. They just do it through the wonderful world of the Internet and telephones.

Debt consolidation and debt counseling loans are quite big business now. With the changes in the bankruptcy laws, it is becoming and even bigger business everyday. Unsecured credit is plain too easy to take a hold of, and more people are finding themselves in debt up to their eyebrows with no apparent way out. More and more of these men and women are turning to online debt counselors and online debt consolidation loans.

The nice thing about working with an online debt counselor is that he or she really is as close as your telephone. Such counselors are known for making themselves available to their clients when they are in need. The debt consolidation loans that are obtained online are precisely the same as the debt consolidation loans which are obtained offline. There is absolutely no difference between the 2.

Overwhelming debt isn’t any fun. Those constant phone calls will drive you nuts. Those harassing collection letters can drive you up the wall. You can get out from under that debt, but it is going to be up to you to take that 1st step and contact an online debt consolidation company.

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Each and every year credit card debt continues to swell among the American population and it is the number one form of debt in America. With the tough economic times going on right now people are using credit cards for what they normally wouldn’t, like groceries and gas. Whenever you do this, you are paying interest on things that you need for your day-to-day living, which makes you end up paying more for these items than you would if you could just manage to use cash and save your credit cards for emergency purchases. Whenever you purchase something with a credit card it becomes subject to interest rates that are agreed upon, and more often than not the minimum payment is made towards the purchase over a span of years. So, one tank of gas or one trip to the grocery store for a week’s worth of food will literally take you years to pay off!

A really good form of debt management is taking advantage of credit counseling. Credit counselors are normally certified debt management specialists which will have a huge amount of information regarding different debt management tactics. These include debt consolidation and debt reduction. This counselor will be able to look at your current state of affairs and be able to give you advice on which path you should take to secure your financial freedom in the future.

Before you journey out to find a credit counselor, take the time to put together a list of all your credit card accounts with the following information included for each: creditor, creditor contact information, current balance, monthly payments and interest rate. This is the basic information about your account and can help with the process of planning to get rid of that debt. In this article, I am going to cover two of the main forms of credit counseling and some of the different ideas that surround them.These two will include debt consolidation and debt negotiation.

Debt consolidation is the form of debt management that allows you to request a loan that will be used to pay off all other, including credit card, accounts leaving you with only one loan with one monthly payment and one interest rate. This can often give you relief from being harassed by creditors, and will effectively lower the amount of money you have to pay out each month as well as the interest rate. These loans are available in secured and unsecured like other loans and this is decided by the level of borrowing power you have.

Debt negotiation is a form of debt management that allows you or a representative for you to contact your creditors and negotiate with them to lower your monthly payments, interest rates or come to a settlement agreement to pay off the loan or account balance at a lower amount. Many people who are in debt might be intimidated by this process, but with the help of a skilled credit counselor often times it can be successfully negotiated.

Credit counselors do more than just offer debt elimination services, they also work at helping you manage your finances better, like putting together a smart pay off plan, a plan for the better, and that they try to help you work on a budget that you can live by and stick to. When you’re considering all of the different options that have to do with credit counseling and counselors, understand that they will be able to help you find the best way out from underneath the heavy burden of your credit card debt, as well as give you the knowledge and the tools to avoid putting yourself in that same situation in the future. If you get the right credit counseling company behind you with the right counselor, you won’t have to deal with embarrassment and radical. Instead it will be a very supportive experience which will help you to move forward and get beyond this hard circumstance.

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