The word “debt”, can evoke a wide range of emotions in many people living in today’s wavering economic state. “Debt”, refers to an amount owed to a person, or an organization, for funds borrowed. Debt can be represented by a loan note, bond, mortgage, or other forms stating repayment terms and, if applicable, requirements for interest. All the various forms of debt imply the intent to repay the owed amount, by an agreed upon date, as is stated in the repayment terms.
Have you ever thought about why you are in debt? Or, have you ever pondered the reasons that underlie your current debt woes? Due to the fact that debt can very negatively impact our lives, it is necessary for us to scrutinize our debt situation and figure out how it is that we have become indebted. Debt is a monster that can erase the value of a lifetime of hard work. It can absorb our assets and encourage emotional and psychological pressure, putting stress on even the strongest interpersonal relationships. Figuring out why we are in debt is very important to resolve that debt.
It is surprisingly easy to fall into debt. As such, there are countless reasons people fall into debt. These reasons may range from the difficulties faced with mortgage repayments to just not saving enough. Mortgage repayment has shaken the very foundations of the finances of many homeowners and families, to date. In an attempt to keep up with the payment of the mortgage, many people find themselves severely indebted to various loans organizations. Being faced with losing their homes drives many to borrow more money than they are possibly able to repay.
What is a Loan Modification?
The term ‘Mortgage Modification’ refers to a permanent change in one or more of the terms of your mortgage. As a result, the amount you pay on your mortgage will drop to something more manageable for you. As with every form of assistance that you may receive, you have to first qualify for it. At A1 Debt Solutions, there is no set standard for qualifying for a mortgage modification or loan modification. Qualification for this type of assistance is done strictly on a case-by-case basis.
Today, many organizations offer many options for debt consolidation – they claim to help lower your debt. These ‘methods of betterment’ include debt consolidations, refinancing mortgage loans and forbearances. Let us take a closer look at one of these options, for example ‘debt consolidation’. With debt consolidation, the amount that you pay is not decreased; it only ‘seems’ decreased because the time that you get to repay the loan is extended. In other words, the longer you stay in debt the less you pay per-installment, but you eventually pay more over time.
Debt Negotiation and Debt Settlement
Debt negotiation and/or debt settlement is the process to strike a deal with the creditor which will result in the debtor paying much less than what is actually owed.
Creditors are inclined to agree to this sort of negotiation due to the fact that the debtor may really not be able to repay the loan. As such, creditors are often willing to take a percentage of the total over nothing, should the debtor happen to file for bankruptcy?
In filing for bankruptcy, you must take your credit score into consideration. If at all possible, you should avoid filing for bankruptcy. It is legislated that before individual files for bankruptcy, he or she must enter into credit counseling.
Let one of our trained debt consultants evaluate your financial situation to determine if debt negotiation is right for you.
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