With money problems caused by excessive credit card debt and other unsecured consumer debt obligations, debt relief seems impossible and life can become miserable from a constant stream of collection letters, collection phone calls and other forms of harassment. With damaged credit, many people find it difficult to get a decent job, obtain reasonably priced credit - or get any credit at all… and rent a place to live under reasonable terms. Often, resolving these problems can lead many to take actions that are not necessarily in their best interests over the long term. Below, we've listed some of the more common actions people take to deal with their credit problems.
- Continuing to endure and avoid creditor calls robs you of valuable time and creates unneeded stress. Often, embarrassing situations arise in which your credit problems are exposed to your close friends and associates. Nonetheless, many choose to simply continue avoiding calls and threatening letters because they are unaware of any other options they may have.
- Changing your identity. This is a popular Internet scam in which unscrupulous operators attempt to convince you that you can achieve debt relief by changing your social security number or substituting another number in place of your social security number. Changing your identity to become "invisible", particularly by getting a new social security number or changing your name altogether is a difficult - and almost impossible process. The legal system requires, among other things, substantial justification for taking such an action (and avoiding your debt isn't considered justifiable) so you may end up with legal bills and no results when taking this path.
- Taking out a home equity debt consolidation loan to become debt free. With the low mortgage interest rates today, many homeowners loaded with excessive consumer debt see this as an easy way to reduce their monthly payments and lower their interest expense as well. While there is validity to this thought pattern, the cardinal rule being broken with this approach is that you are "eating up" or "living off" your home equity. Your home is probably the most important investment you have - a very likely represents a substantial portion of your wealth. Using this equity to pay for consumer items means your using up investment capital to pay for items that only have a short useful life. Thus, you pay off the microwave oven or washing machine bill - both assets with a life of only 5 years or so - with debt that is going to last for the next 30 years. This is not good use of your investment capital and often just leads to a false sense of "lower debt". Often - those who follow this course find it easy to run their consumer debt back up again in a short period of time.
- Declare bankruptcy. While this is one of the most popular methods of eliminating debt - it is not without it's owns special set of costs. A bankruptcy can stay on your credit report for up to 10 years and often - especially in the first year or two following a bankruptcy - will create a sort of "stigma" that still makes it difficult to acquire any form of credit on decent terms.
- Fill out our "Debt Consultation" form. More and more, consumers with money problems are discovering this less painful and effective way to protect their credit, improve the credit rating and avoid bankruptcy. Creditors don't want to lose all of their money - so virtually all of them will participate in some form of debt negotiation program in order to lower their losses and recover a portion of their original investment. US Debt Network has a variety of debt relief programs in place that provide financial help to reduces bills and save money for over burdened debtors. Participating in one of our debt negotiation programs will often result in 30% to 60% debt reduction and greatly reduced monthly payments.
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