Debt Management Solutions

With debt management solutions there are various options available to choose from. Unfortunately if you are like everyone else, you will end up choosing the wrong one!

When watching television or listening to the radio you are bombarded by these debt management solutions companies with their slick sales and marketing commercials.

In these commercials they tell you they will lower your monthly payments and interest rates. As a matter of fact, some of these debt management companies have the gull to tell you that they will eliminate your debt. In a nutshell here's how it works:

They contact your creditors and negotiate lower monthly payments and possibly even lowering your interest rates. This all sounds great right? Well its great until you find out what this does to your credit...

The SHOCKING truth about Debt Management Solutions Companies

Yes while it is true your monthly payments will be lowered, it is also true it will be done at the expense of destroying your credit! Using one of these debt management solutions companies is almost the equivalent of filing for chapter 13 bankruptcy. And as a consequence you will have difficulty attempting to take out loans.

For example, if you apply for a conventional, FHA or VA loan, you may be treated as if you had filed for bankruptcy under the mortgage underwriting guidelines.

When you use one of these debt management companies all you are doing is transferring or moving your debt to a new location without actually solving the real problem which is YOU. And as stated above, using these companies will only make the situation worse.

Another type of debt management solution is a home equity loan. Here is how home equity loans work:

In a nutshell they allow homeowners to borrow money using their home as collateral. But the question you should be asking yourself is; Are home equity loans a good idea? The answer to that question is a resounding NO!

The first issue is the current housing slump. With the current buyer's market, home seller's are being forced to drastically reduce the price of their homes. If you borrowed 100% of the value of your home, you will end up owing more than what the house is worth. That is financial suicide and makes no sense whatsoever.

One of the reason's why HEL's are so popular is because homeowners like to use them for home repairs, improvements, vacations etc. My response to that is why not just save up the money. Use other sources such as borrowing money from your 401 (k). See our money saving tips and frugal living section for ideas on saving money.

Homeowner's using HEL's to consolidate their debt is another poor money management solutions decision. Once again all your doing is transferring one bad debt to another. When you consolidate your credit cards and car loans with a HEL, your not confronting the real problem which is YOU and your poor money management skills.

The bottom line is that HEL's are a really bad way to manage your finances. They will keep you in shackles longer and prolong your agony as a slave to your creditors!

REAL Debt Management Solutions

The real solution is that you need to look at yourself in the mirror. You need to change your behavior and spending habits. You must also realize that this will involve a lot of pain and hard work. Using a debt management company is nothing more than a painless quick fix!

Managing your debt is nothing more than common sense. It is NOT ROCKET SCIENCE FOLKS!

Here are some informative articles on managing your debt from our contributing authors...

Here are a few bits of credit card debt advice to help you out from behind that stack of bills.

Learning how to manage your money: save $900 in a year on a monthly income of $1500!

Ways to settle credit card debt.

Bankruptcy Alternatives that allow you to maintain a comfortable lifestyle!

How to repair credit - without using a service company!

Credit card debt solutions provides you with real and genuine solutions... Not some "quick fix" that doesn't correct the real issue!

If you receive an 'instant credit card approval' offer in the mail... Then please make sure you read the fine print...

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Here's some advice about credit card for bad credit offers.

As you know bad personal credit can be a heavy burden for anyone to carry.

Bad credit card debt can really make getting to sleep at night a challenge.

Debt Elimination scams have become a multi-billion dollar industry because they take advantage of desperate consumers.

For fast credit repair... at least as fast as possible!

Here are some great tips on Getting Out of Debt...

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