Make Debt Easier to Deal With

We live in tough economic times, and despite doing our best to keep up with our bills, sometimes the credit card, the very thing that helped us in times of need, becomes our worst nightmare. Particularly after losing a job. However, help for getting through your debt issues exist. Whereas many loan-type "get-out-of-debt now" offers turn out to be high-interest loans, other options, like debt- or interest-rate reduction, exist. If you find yourself in an unfortunate position, here are some ways to help you reduce your debt or the burden of your debt.

The first place to start with is, believe it or not, your credit card company(ies) and or the bank you got your credit card(s) through. They understand that this is a hard economic time for many. They would rather have you pay smaller amounts on your credit card than let it go into default.

If you don't feel comfortable working with your credit card provider or bank to help you reduce your debt load, or if you have other debtors as well, organizations exist to help consolidate your debt, reduce any interest rates on your existing credit cards and other debts and maybe even help you get rid of some collection fees.

These organizations, like Money Management International, are mostly not-for-profit organizations that will offer free debt counseling services. Debt counseling will review your current financial situation asses your ability to pay and if you choose, they can set up a debt repayment plan. Under such a plan, they will contact any debtors on your behalf to inform them of your intent to repay and will attempt to have the debtors rescind any late fees and maybe even reduce your debt to assure that you will pay it rather than default on it. There is often a monthly fee on these services, however.

When entering a repayment plan, your credit cards are frozen. This can sharply reduce the interest rate you'd pay if you were carrying a high balance and trying to repay your card.

When choosing a repayment plan, make sure it's through a reputable organization. Make sure the organization is a member of The American Association of Debt Management Organizations (AADMO). Go elsewhere if they try to rush you into a repayment plan without a consultation.

-Chris Meehan