While most people tend to stress over debt, many are starting to realize it can be a significant instrument when used deliberately. Through a mortgage you can own your own house without having to pay rent anymore, an auto loan can provide you with transport, and credit cards can help you get the items you want. However, without the knowledge of managing debt, Americans can deal with their financial burdens for years.
Statistics show that the average American holds a debt balance of $96,371, according to the latest Experian data.
Key Takeaways on Americans in Debt
- 50% of Americans prefer to rather boost their emergency savings than pay down the debt they own.
- 38% of households in U.S. earning between $50,000 and $74,999 per year have more credit card debt than emergency savings, which is the highest of any income bracket.
- 27% of Americans taking on student loan debt are delaying saving for emergencies.
- 68% of millennials (ages 26-41) & 74% of Gen Zers (ages 18-25) taking on student loan debt for their own education have delayed an important financial decision as a result of their debt.
- 19% of those with credit card debt have been in debt for at least five years.
(Statistics from Bankrate.com and Creditcards.com)
As we can easily observe, having debt is a big step back from achieving your dreams. Let’s explore the options you have in order to get out of debt faster.
Understanding Debt Relief
Debt relief programs will give you the tools to change the amount or terms of your debt so you could break out of it faster.
Debt relief programs were created to ease the citizens’ financial burdens, but this solution comes with consequences, too. That’s why it’s essential to learn how they operate. After understanding what a debt relief program is, you can consult multiple programs and see which options are most suitable for you.
The strategy is called “debt settlement”. There are more ways of erasing your debt through your chosen debt relief programs:
- Wipe all your debt in bankruptcy;
- Changing your payment schedule or interest rates in order to lower your payments;
- Convince the creditors to make a new contract in which they accept less than the whole owed amount.
How to Avoid Scams
Like any other industry, the debt settlement one also includes scammers. Don’t worry, if you follow a few steps while checking the background of the company, you’ll be able to spot from miles away a real or fake organization.
Firstly, there’s one type of scam that’s easily detectable. If you will receive an unsolicited email from a person or company offering to help with your debt, be sure it’s a scam. No respectable company finds its clients this way. Secondly, they will ask for the fees upfront.
Even if they make you complete a questionnaire and offer you a personalized offer promising you they’ll get rid of debt, but first you have to pay a fee, it’s probably a scam. Go to your official state site and fill in a complaint so they can be stopped to scam others too.
Also, regarding legit debt settlement companies, a few points to follow before signing any agreement:
- Check what requirements you must check in order to qualify;
- The fees you will have to pay must be clear;
- Verify what creditors are paid and what amount;
- The tax implications;
- See if your debt is in collections.
Debt Relief for Student Loans
Of all loans, student loans are the hardest. A mortgage helps you obtain your own home, an auto loan provides you with a car, but a student loan gives you access to superior accredited knowledge which is counted in years of learning and sleepless nights. Plus a huge loan to only obtain a diploma to help you get into the working force.
But don’t worry! Like all debt, student loans can be settled and erased through special programs by simply completing a debt relief application with your chosen company.
There is one federal debt relief plan but is currently stopped and blocked. The Biden Administration’s Student Loan Debt Relief Plan was supposed to help students to get loan forgiveness of up to $20,000 under specific circumstances: after 120 payments working full time for federal, state, Tribal, or local government; the military; or a qualifying non-profit. Read more about it here.
However, it can take a long time to access a federal program, and with its continued pauses, it can take longer than paying the debt itself.
Most debt relief settlement companies include student loans as part of their plans, so you can check the list below.
Best Companies for a Quick Debt Relief
These are our top companies for debt relief that have reasonable fees and can help you get out of debt quickly. All you have to do is check the answers about your kind of debt and you will receive their solutions and available options you qualify for for free in your email.
GREENWISE DEBT RELIEF
This company is providing free consultations and a personalized debt solution that can assist you in paying off unsecured debt in only one or up to 2 years. Founded in 2018, the company has earned popularity fast due to its superior solutions compared to other similar firms. Its headquarters are in Boca Raton, Florida. It’s trusted by the American Fair Credit Council (AFCC) and also has great customer reviews.
Greenwise Debt Relief can help you settle your debts for 68% to 75% of what you currently owe – after you factor in your current debts and debt settlement charges. Its fees range from 18% to 25% of settled debts.
ACCREDITED DEBT RELIEF
Accredited Debt Relief was founded in 2011 and currently has an A+ rating from the Better Business Bureau (BBB) and a green light from Forbes Adviser. Since its launch, it has helped over 200,000 people resolve over $1 billion in debt.
The company can help you reduce your debt to up to 50%. Its fees are between 15% and 25%. A big plus is that you don’t have to pay if your debt isn’t successfully settled. In order to qualify for this program you must have at least $10,000 in unsecured debt. Verify for free their personalized solution for your debt below:
ClearOne Advantage is a company providing settlements of unsecured debts, (for example credit cards) for people across the U.S. It’s based in Baltimore, Maryland, and is accredited by the American Fair Credit Council (AFCC) and the International Association of Professional Debt Arbitrators (IAPDA), also holding an A+ rating from BBB.
You can save up to up to 50% on your debts before fees — or 25% after fees, depending on the gathered amount and creditors’ flexibility to negotiate. Settlements can take anywhere from 24 to 60 months. The company’s fees can be up to 25% and the clients’ reviews are very positive.
PRIVATE DEBT RELIEF
This full-service debt resolution organization will negotiate with your creditors to erase up to 50% of your debt. In order to qualify you need to be fully employed, have a minimum of $10,000 in unsecured debt and don’t be enrolled in another similar program.
Compared with the other organizations mentioned in this article, TurboDebt operates differently. It partners with National Debt Relief to negotiate your case. Turbo Debt will offer you a free initial consultation and if you are pleased with it, National Debt Relief will then take over. They will be able to wipe up 50% of your debt, while their fee can raise up to 25%.
Both companies have very high reviews. Turbo Debt has an overall 4.9 stars with over 2,300 client reviews while National Debt Relief scores 4.6 stars out of 4500 reviews.
UNITED SETTLEMENT DEBT RELIEF
This debt settlement company was launched in 2015 and has its headquarters in New York, NY. It offers debt relief services to clients in 39 states and is IAPDA accredited.
The company offers settlements for a wide variety of debts: private student loans, federal student loans, business debt, and all types of unsecured debt, such as credit cards and personal loans.
The big pros of working with this company are that it has smaller fees than similar firms and it doesn’t have a monthly consultancy fee. The company also has IAPDA-accredited debt experts on staff.
Overall, you can try one or all companies, we have chosen the best companies for debt relief based on legitimacy, results, fees and time needed to erase all debt. see what quotes you will receive, and compare them, it’s free. The main differences between them are written above.
Learn How to Budget Before You Get into Debt
One proven-to-work solution to gaining debt is to prevent it. By learning the rules of the correct way of budgeting, you will have savings and be up to date with your fees before you know it. I’ve covered it in:
9 Most Effective Ways On How To Pay Off Debt In US,
How To Budget Money On A Low Income? 4 Ways To Save Money,
7 Ways To Save Money On A Tight Budget (2023)