Many Americans may be wondering how to get out of debt fast as their bills and credit balances have piled up in recent months and created a financial headache. How to get out of debt fast is a common question that has several answers which may allowconsumers to pay off or greatly reduce the amount they owe to creditors.
One method to get out of debt is to seek the help of a debt settlement agency. Using this method, a consumer will have a trained negotiator assigned to them, who will negotiate with creditors on the debtors' behalf in an attempt to reduce the total amount they owe. Once the debt has been negotiated down to a lesser amount, lenders often require consumers to pay their negotiated debt amount in one lump sum. This will require the consumer to save up a lump sum payment before the debt can be settled, and the program usually lasts between 24 – 48 months. However, debt settlement is often successful in reducing a consumer's total original balance owed by up to 50 percent, making it a possible solution to the dilemma of how to get out of debt fast.
Another way for consumers to get out of debt fast is to call their lender and ask to have the interest rates reduced on their account. While this may not work for everyone, it can't hurt to ask. Consumers may find this method to be particularly helpful if they have a credit score good enough to qualify for a credit card with a lower interest rate from another lender. The threat that a customer may leave and transfer their balance elsewhere could be enough to convince the lender to lower the interest rate to a rate that is much more manageable.
If lenders are steadfast on the interest rate figures, and the consumers’ credit score is still high enough they may benefit from seeking a balance transfer to a card that carries a low, or zero-percent introductory rate. With this method, a consumer compiles interest on their existing balance much slower than they did in the past, which may allow them to cut their debt significantly before the introductory offer ends and the interest begins to accrue again.
Yet another option for those trying to figure out how to get out of debt is to talk to a credit counselor, who can suggest a debt management plan that could help pay off debt within four to seven years. Although this method is not as fast as debt settlement, this type of program makes consumers devote considerable time to a financial education process that will also help draw up a sound financial budget and eliminate unnecessary expenditures to further chip away at their debt. In a credit counseling program, consumers will usually pay back every dollar of the principal they owe, but at a lower interest rate.
Before arriving at any solution on how to get out of debt fast, consumers should first review their finances and research their options to ensure they choose a plan that best fits their financial situation.