If you have fallen way behind on your bills and need some help consolidating your debt then you have a couple choices to make. The first place to call is the company who you are paying your bills to. The second one is to contact a debt settlement company which will work on your behalf to lower your debts. A third and more recent option is to use a peer to peer website and try to get a loan.

Working with your debtors is the first action anybody should take. Staying in communication with them keeps them informed about your situation. Some companies will forgive some debts or lower the rates you pay on them. If this happens then you should feel lucky. Do not be mad if they do not try to work with you. There was a contract signed by yourself that you should have known about. Your creditors are in business to make money not lose money.

If they will not work with you then it is on to option two. Its time to call a debt settlement company. They will take a look at all of your debts and let you know which ones they have a chance of lowering for you. They will in turn contact your creditors and start negotiating on your behalf. Many of these companies are ran by lawyers who are experts in negotiation. When you hire them you will have to pay them a fee and sometimes it can either be a flat one or a percentage of the amount of debt they have negotiated for you. One thing to keep in mind is that it will show up on your credit report as settled for a lower balance. Be prepared to see a drop in your credit scores but be happy knowing that you are probably going to be paying a lot less back. One of the more successful companies is called Cura Debt.

If you have no luck working with your creditors and the thought of ruining your credit is not going to work for you then a peer to peer lending site might work for you. How these sites work is a group of people come together looking for a place to invest their money. In this scenario, you put a listing of yourself up asking people to lend you money. Normal people, not banks, will pool their money back until the amount you are asking for is reached. When the amount is reached the interest rate at which you first listed yourself up for starts going down as people bid against one another. You want the bidding to keep on going as it lowers your interest rate. After the bidding is done you will be given the money and have to pay it back over a set time period which is usually three years. You make monthly payments back and the people earn the interest rate you are paying them. Every body wins here because you get a low rate loan, no dings on your credit report, and normal people earn money for helping you. A popular peer to peer site is Lending Club.

All of these will help you with your debt problems. Each has their risks and rewards and some are better than others. When it is all said and done just remember to never get yourself in this situation again.

Technorati Tags: debt, Debt Consolidation, debt settlement, debt settlement company, peer to peer lending

The current economic crisis is catching up with people as they are losing their jobs and having to work for less. When either of these events occur many people end up going into debt. It’s not that they want to it is that they have no choice. It is getting so tough that filling up the car with gas, buying food, and keeping the heat on in the house are now a burden..

This unfortunate chain of events seem to happen at the same time. There is just no income coming in to make the minimum monthly payments on credit cards which you were using to stay afloat. With your back up against the wall, you only have a couple choices. Try to work with your creditors for lower payments or contact a debt settlement company.

If your creditors will not work with you then you need to try to consolidate your debt. A company that specializes in settling debts will contact your creditors and start negotiating with them to lessen your overall financial obligations. The best ones can work your creditors down to 60% less of what you owe. Many creditors will take it even at a loss as many need money to stay in business. However, the process can take awhile to complete. Most creditors will drag this process out as long as they can, sometimes taking up to a year before they even begin. Don’t think you will be able to get approved on any new credit as your credit scores will suffer.

What other ways can you put all of your bills together? In the past, many people would combine all of their bills into their house payment which would lower their overall monthly payments freeing up some money. With the way house values are decreasing it is becoming harder and harder to roll everything in as home equity is evaporating.

One way that is becoming increasingly popular is to get a personal loan.Social lending is the newest lending craze. Borrowers put a listing up of what they need the money for. Normal people put small amounts of money in until the amount you are asking for is reached.. For people looking to consolidate a low amount of debt this might be a better route to go as you will not ruin your credit score.

Deciding to deal with your debt is a issue everybody has to deal with. Take the time to decide what debt consolidation route is the best to take. Each has their own pluses and minuses and you need to look into what will prepare you to get ahead in the future.

Technorati Tags: debt, Debt Consolidation, debt settlement, debt settlement company