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Hello my name is Steve Bis and I am assisting consumers that are in debt with their unsecured credit card debts for a long time and know the effects it has on someone's life. When you have credit card debt and think that the situation is no longer something you can control, you should make a choice on what to do and make it as soon as you can. You do not want to put it off until it is too late. As plenty of you already know is that the debt collectors are not polite when you contact them with issues regarding your statements. It's pretty interesting the way it works because when you initially get the card they are the politest people while you are on the phone with them. Then if you contact them to complain about a late or over limit penalty fee and try to have it reversed enough trying to keep up with 8% or even the 7.9 % interest that they are charging on your accounts. How are you suppose to afford the elevated payments now? It was cumbersome enough to manage before the interest skyrocketed. This is the reason U.S. citizens are seeking out other options such as debt settlement vs. credit counseling, or bankruptcy. If you are not familiar with any of your options then I will offer you a little bit of an education on them.

Consumer Bankruptcy

Up until late 2004 bankruptcy was to be used for individuals who were going through severe monetary troubles. Regrettably it was misused by way too many Americans who wanted to avoid paying their unsecured debts. They did not want to take responsibility for their actions. The credit card companies were fed up with this so they lobbied to have the laws updated. It is now known as the Bankruptcy Abuse Prevention and Consumer Protection act of 2005. It would make it more difficult for most debtors to file for help. Bankruptcy should only be used as your last resort option after you have tried every conceivable method. Also you should understand the negative aftereffects that very well might come back later down the road. You would have to locate an attorney, go to court and that could run you a substantial amount of money. There is also the negative effect of it being on your credit report for a long time. When you are signing any significant application or document you will always have to say yes when inquired about your previous bankruptcy, so this does have a long lasting effect on your credit.

Debt Consolidation Credit Counseling

In each direction you look, either on TV or the radio, you will hear about debt consolidation credit counseling. A credit counseling company will try to get the creditors to lower the APR on your credit accounts. You then make one monthly installment to the credit counseling company and they then make your payments to each one of your creditors for you. The drawback to this choice is even though they lower your interest on your credit card balances you might still pay back as much as 120% of what you actually owe.

This is because on this kind of agenda you will still be paying back what you owe plus some of the interest for around possibly five years or more. Almost 80% of the debtors that are in credit counseling don't complete the program for one reason or another. Another draw back to credit counseling is that if you have a income problem and are cannot make your monthly payment they will kick you out of the program right away. They will also raise your interest back up and the creditor could keep you off for around one year and perhaps even longer. This might put you right back to where you started from, if not in a tougher situation.

Credit Card Debt Settlement

This is the avenue which can save you the greatest amount of money. A good credit card debt settlement company will save you at least 40% of what you are said to have to payback. The 40% should include all of their charges. Similar to credit counseling, you will hear a lot of TV and radio advertisements all the time. These companies are opening up everywhere across the United States. Some of these companies try to make it seem like they have a magical button and are going to make all your debt vanish out of nowhere.

There are also many companies that try to use religion to obtain the trust of people. Whichever organization you are speaking to it is your responsibility to do research on them. You should begin with the BBB (Better Business bureau). You may be able to uncover a lot about a company from the BBB. If you discover that a company has only been in operating for a short time and has a slew of complaints towards them, then you must avoid them. One more thing to keep an eye out for is how much time has the company been in business. Some companies only survive one or two years before they go out of business or get caught ripping people off. Then some of them only stick around to earn as much as possible and close down just to open up across townwith a different name] and will continue to do this over and over.

You need to feel secure with the person you are speaking with as well as the debt settlement organization. If they are really pushy and trying to get you to sign a document within the first few minutes of the call you need to be very careful. This is not a choice you want to dive into head first. Really, how can a company know they can help you out without reviewing your situation first? There are a lot of companies out there that only tell you all the positive things about their program. They tell you not to fret anything. This is a very easy process and nothing negative will ever happen to you. That is a load of you know what. It is not a very easy process and it is not right for every consumer. Some Americans still get duped by them because that company candy coated the entire process and did not offer them full disclosure. For a lot of people credit card debt settlement can really get you back on your feet and out of debt in under three years, while saving you thousands of dollars off your balance.

One more issue to remember is most of the companies earn all their fees within the first year and a half of the their program. Now I will ask you this question, what incentive will that company have to negotiate the best possible settlement on your behalf if they know that they are'nt going to earn any more money off of you? There is none! So you see, if that company understands that why would they keep working on trying to get you the best settlement. This happens very frequently. They really don't care at that point. They take whatever your creditors' offer, in turn meaning you pay more You need to search out a company that earns its fees the old fashion way, by earning it. Make sure they answer all your debt settlement questions. I hope this has offered you a better understanding of the varied choices you have to becoming debt free. Thank youThanks a lot and have a good [night.

Steve Bis is a debt analyst with the US Consumer Advocate, which practices debt relief.