Guest Post: Sharon Smith ( findsharonsmith@gmail.com )

Stuck badly with your debts? Are the mounting interest, repayment defaults and constant harassment by the creditors snatching your peace away? If you are frantically seeking a way out, but desperately want to avoid bankruptcy, then debt consolidation and debt negotiation are the options on the palate for you. A glimpse into these settlement programs would surely help you in this regard.

If you are opting for a debt consolidation program, it allows you to do away with the headache of multiple debts with varying interest rates. It rather makes way for a single affordable and consistent monthly payment at a much lower rate of interest. Whereas debt negotiation aims at a balance reduction in which both the debtor and creditor agree. That reduced amount is regarded as payment in full.

If you are not keen on filing for bankruptcy, consolidating debts might be the best solution to your problem. Moreover, unlike debt settlement, debt consolidation assures a clean credit record in the long run. Well, if you have been worried all this while, whether you can consolidate debt with bad credit or not, be assured that even those with a bad credit record are eligible for it.

Now, if your finances look really bleak, debt negotiation is perhaps what you must opt for. It lies to a great extent at the mercy of the creditor. It can be done only if the creditor agrees to do so. Often it is difficult for an individual to persuade the lender for it. In that case, you may always seek a professional lawyer or negotiator’s help. Effective negotiation can settle your debts for about 40-60% of your current balances. Unlike bankruptcy, debt negotiation does not entail liquidation of assets. Creditors offer twenty four to thirty six months so that the borrower can repay the balance amount owed.

However, choosing the right mode of repayment fitting your situation is absolutely important for you, lest your decision turns out to be a financial gaffe!