The numbers of debt ridden customers are increasing. While credit facilities take up the fancy of buyers, they land themselves in debt. Not everyone has sense of managing the accounts. Nor do they understand interest and rate applications and fall into debt traps. Debt reduction is an innovative approach to solve unsecured credit card debts. The approach is made by reducing the debt as well as the monthly payment by almost 50 percent and eliminates debts in a year or two. To a great extent, this method of solving the problem of unsecured debt also brings along emotional satisfaction and is financially more rewarding.
The company dealing into debt reduction programs enables the client to pay reduced and easy monthly installments based upon the living standard and account activity of the client. The average monthly payment tends to be between 1.5% and 1.75%. Client deposits their monthly installments in a saving account opened by the debt reduction company. The amount is automatically debited from their current or savings account on a fixed day of every month. After the client has saved enough money, the company negotiates with the creditors on behalf of their clients and convinces them to accept a lump some amount for debt settlement.
Once the negotiation and settlement is completed, clients receive a letter from the company notifying them of the reduction of debt. The creditor then provides a credit report to the clients stating that unpaid dues are settled and relives their clients from debt. It is the greatest source of satisfaction for people who have been buried under heavy load of unsecured loans and credit card bills. Once the debt is cleared, it is advisable to take stock and check if any credit cards are required. Maybe for sometime purchases and shopping can be suspended.
Dec 06 2010
Debt Reduction Program
Sep 03 2010
Debt Settlement USA – Is This Your Best Option For Debt Settlement?
Everyone has heard of Debt Settlement USA, they are well known for being able to help you eliminate your debt. There are many people these days that want to get rid of their debt, but are unsure if this is the right choice to make or if another company would be better. To help you make a more informed decision, there are some important things that you need to know about them.
The first thing to know is that they are based in Scottsdale, Arizona and are one of the largest companies around that is still providing help for many people to get away from the viscous debt cycle.
It is always a smart idea to do your own research on this company to check them out for yourself. This will help you learn a lot of useful information about them to make a more informed decision. Also, check with the BBB about this company or any other company for that matter, before hiring them for help with your debt
settlement.
An important thing to know before hiring this company is that in order to be able to hire them, your debt needs to be at least $12, 000 in unsecured debt. The debt can include things such as medical bills, hospital bills, overdue rent, credit card debt, personal loans, past due water bill, past due gas bill and even a past due electric bill.
One interesting thing to know about this popular company is that they have an electronic enrollment system that allows anyone to sign up fast and easily so you can get started on the road to being debt free that much quicker. Check this out more for yourself before deciding if it is right for you or not.
Now, before hiring this company or any other company, you need to make sure they can offer you certain things. Some of the most important things they should be able to offer you include:
1. They need to be able to lower your monthly payments.
2. Can help you save as much as 70% on what you owe.
3. Help to be debt free in 12 to 60 months.
4. Advice that is fast, friendly and right for your debt settlement.
Always take the time to research Debt Settlement USA or any other company before deciding to hire them. Be sure that they are your best option for debt settlement because this is too important to make a rush decision on. The best company needs to be hired for help in order for you to eliminate as much debt as possible.
Jun 24 2010
The New Bankruptcy Law Means Test Simplified
Prior to October 17, 2005, consumers who filed for bankruptcy had the choice to file for Chapter 7 or Chapter 13; when the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) took effect on October 17, 2005, that choice ceased to exist and consumers now must pass the “means test” in order to file for Chapter 7 bankruptcy protection.
Under the means test, it is presumed Chapter 7 bankruptcy is liable to be abused and therefore not allowed, if the debtor’s monthly income, less allowances and living expenses, and multiplied by 60 months (adjusted income), is greater than $10,000. If a debtor’s adjusted income is less than $6,000, there is no presumption of abuse, and the debtor is free to choose Chapter 7. If a debtor’s adjusted income is between $6,000 and $10,000, abuse is presumed only if the debtor’s income exceeds 25% of his/her non-priority, unsecured debt.
The Basics of The Bankruptcy Law Means Test
In the means test, the courts will look at the debtor’s average income for the 6 months prior to filing and compare it to the median income for that state. If it is below the median, then Chapter 7 remains open as an option. If it exceeds the median, the remaining part of the means test will be applied.
The next step in the calculation takes income less living expenses (excluding payments on the debts included in the bankruptcy), and multiplies that figure times 60. This corresponds to the amount of income available over a 5-year period for repayment of the debt obligations.
If the income available for debt repayment over that 5-year period is $10,000 or more, then Chapter 13 will be required. If it is less than $100 per month, then Chapter 7 again becomes an option. If it is between $100 and $166.66, then it is measured against the debt as a percentage, with 25% being the benchmark.
To sum up, first figure out whether you are above or below the median income for your state – median income figures are available at new-bankruptcy-law-info.com. The incomes of both spouses, if working, should be considered. Next, deduct your average monthly living expenses, as approved by the IRS, from the monthly income and multiply by 60. If the result is above $10,000, you’re stuck with Chapter 13. If the result is below $6,000, you may still be able to file Chapter 7. If the result is between $6,000 and $10,000, compare it to 25% of your debt. Above 25%, you’re looking at Chapter 13 for sure.
A helpful tip for those seeking to avoid the twists of the bankruptcy law means test. Because the means test is based on wages during the six months prior to filing, some lawyers may have their clients file during a slow period of employment or while they are between jobs. In other words, simply clever timing of the filing of your Chapter 7 case may help you get by the bankruptcy law means test.
If you are still looking for some more helpful tips, visit my site on financial planning.
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