Structured Debt Management Plans

You have probably heard the news that the nation’s credit card debt burden is the highest it has been in five years.  This news probably blends in with all the other recent news about record high prices and record high debt.  There are plenty of ways to get out of credit card debt, but most of them require a deus ex machina.  You can earn more money and put all your extra cash toward paying down your credit card debt, but you already spend approximately 18 hours per day, seven days per week on gig work, and it barely covers the minimum payments on your debts and buy now pay later (BNPL) bills.  You could reduce your expenses by moving in with relatives, but you moved in with your relatives months ago, and while your fuse is getting shorter, your credit cards are still maxed out.  The solutions available to you are either to declare bankruptcy or to beg or borrow from lenders in order to buy time to pay your credit card bills or reduce the amount they demand.  For help choosing the best way to address your credit card debt, contact a Miami debt lawyer.

How Is Debt Management Different From Debt Consolidation or Debt Settlement?

When you are in dire straits with your credit card debt and want to avoid filing for bankruptcy or are ineligible to file for bankruptcy because of a recent filing, your best options are debt consolidation, debt settlement, or a structured debt management plan.  Debt consolidation is where you borrow a new personal loan with a lower interest rate than your credit card.  You use the loan to pay off your credit card debt, or pay down as much of it as the loan will cover.  You save money over time because you are then making payments on a low interest loan instead of a high interest credit card.

Debt settlement is where you negotiate with the credit card company to give you a discount on your balance, usually by waiving some of the interest charges and fees that have accumulated.  Credit card companies are often willing to settle because it is better than you paying nothing.

Structured debt management is where the credit company lowers your interest rate.  Therefore, it has a similar effect to a balance transfer.  Usually, a credit counseling company negotiates the structured debt management plan on your behalf.

Are There Any Drawbacks to Structured Debt Management?

Structured debt management can be an effective way of freeing up funds to pay down your credit card balance.  The most obvious drawback to it is that it can temporarily lower your credit score.

Work With a Debt Lawyer About Finding Your Way Out of Credit Card Debt

A South Florida debt lawyer can help you find your way out from under a mountain of credit card debt, whether through debt consolidation, debt settlement, a structured debt management plan, or a bankruptcy filing.  Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.

Source:

cbsnews.com/news/credit-card-debt-hits-a-new-record-high-ways-to-tackle-yours-now/