Being in debt is an unpleasant experience, but not an uncommon one. Millions of Americans face this problem, and there are certain options you can consider for gaining some relief before having to file for bankruptcy. One option to consider is consumer credit counseling. Many credit agencies offer this service, and some of those are nonprofit organizations, which means you can get some expert advice for free. The counselor will recommend a debt management plan after calculating how much you should pay and how much interest to negotiate for with the creditors. The negotiations will allow for monthly paid amounts and possible a reduction in your interest rates. You can also opt to have the credit counsel agency take money from you and send it to the creditors themselves so no attempts are made to hoodwink you.
Another option to consider is a debt consolidation program. This places all your debts together into one manageable account. It will help reduce the interest rates on your debt and you then have to pay lower monthly payment all in one go. To consolidate your debt, you can get a bank loan, a credit union loan or from some other source. You can also put up your home as collateral and get a secured loan to pay your debts.
Debt settlement used to be considered a dubious practice in the past, but more people are using this option these days. To use this method, you have to hire a debt relief company that will negotiate with creditors on your behalf. The ideal end result would be that you have to pay a portion of your debt as a lump sum, while the rest of the debt is forgiven. While this sometimes works, your credit score will be negatively affected. You might have avoided bankruptcy, but the effect on your credit will be the same in the short term.
Finally, if you are feeling particularly confident, you can try to fix your problem on your own. Success is not guaranteed, but you will not have to contend with the additional costs of hiring a team or an expert to help you. Start with a plan that has a clear account of your finances and the debt that needs to be made. Show creditors the official documents backing your claim and ask if they would consider giving you a concession, by pardoning part of your debt, reducing the interest rates or granting some more time to pay the money back. If nothing else works, you can offer to pay a part of your debt as a lump sum in return for pardoning the rest of it.