When Quick Debt Fixes Are Too Good to Be True – 2023 Guide

When Quick Debt Fixes Are Too Good to Be True – 2023 Guide

Unopened bills pile up on your desk. Another missed call from a debt collector is indicated on your phone. Every time you think about checking your bank account and checking how much money you have left for the month, your stomach turns to dread. You are in debt and you don't know how to get out of it.

You wish you could blink and all the outstanding bills and accrued interest would be gone. Why can't you find a quick debt solution and end this whole ordeal?

The reason this doesn't happen is that quick debt solutions are too good to be true. Discover five folk remedies for people desperate to deal with their debts and the problems that come with them.

Quick Fix 1: An incredible deal

Maybe you buy lottery tickets every week in hopes of hitting the jackpot. You may be praying for a sudden inheritance from a distant relative. Or maybe you're hoping to land a dream job with a substantial pay raise. Basically, your grand plan to pay off all the money you owe is coming to fruition.

While it's normal to dream about these types of things, they should never be part of your actual financial plans. The chances of winning the lottery are very low. A dream job is unlikely to happen without actively looking for and applying for it. And waiting for a distant relative to inherit is impossible and not the best thing to hope for.

You cannot rely on luck for your financial support. You will not find a miracle prayer anywhere. On the contrary, it will only put you in more debt.

Quick Fix 2: Bank Debt Consolidation Loans

You have the option to apply for debt consolidation from your bank to get rid of your debt. Debt consolidation means that you consolidate all your debts from different lenders into one monthly payment.

So what is the problem? Well, the first thing you need to know is that getting approved for one of these loans is very difficult. You must have a stable income, good credit, and a solid net worth. If you don't have strong home equity, you'll need a co-signer—someone who can guarantee that they'll take full responsibility for the loan if you can't make the payments. Since you are dealing with heavy debt, you are unlikely to meet the credit score and home equity criteria.

If you do manage to get approved, be aware that there are a lot of risks involved in this solution, which could put you further into debt. For example, if you exhaust your home equity and fail to make payments, you could lose your home.

Quick Solution 3: Debt consolidation loans from alternative lenders

You can get a debt consolidation loan from a private lender. They are likely to have lower standards than the bank for approval. But, the problem with private lenders is that they charge high interest rates which will make it incredibly difficult to repay the loan. This decision can put you further in debt, giving you yet another creditor to worry about.

Quick Fix 4: Debt Management Program

A debt management program is a service offered by credit counselors. A counselor should contact your creditors and negotiate a better payment arrangement for you. They may ask lenders to lower your rates or waive penalties to lighten your wallet.

So what's the problem? Although credit counselors are honest workers, they cannot enter into legally binding contracts with creditors. The lender can go back on the agreement at any time. Counselors also cannot prevent your creditors from taking legal action against you for collection purposes. As you can see, debt management offers no 100% guarantee that it will be effective.

Is there a quick fix for debt?

The truth is that there is no magic bullet. Debt is a complex situation, and unless you see a drastic change in income, your problem is unlikely to be resolved in a few weeks. Dealing with your debts takes time and persistence. Whenever you see a quick and easy solution to this problem being offered, you should be extremely suspicious.

So what can you do?

Your best bet is to turn to a licensed bankruptcy trustee firm like David Sklar & Associates for help. A licensed bankruptcy trustee is a state-licensed professional who offers a variety of services to people struggling with debt. They are licensed by the Superintendent of Bankruptcy. They are closely monitored by federal regulators.

Creditor agreements if these trustees are considered legally binding. The important thing is that they are as legitimate as possible.

If you have a small amount of debt, you can approach the company for credit counseling. Services can help you focus on a variety of goals such as managing debt, budgeting money, and building good credit habits.

If you are facing significant debt and want relief, you may consider filing a consumer proposal. A proposal is an agreement with your creditors that reduces your total debt and gives you up to 5 years to manage the payments. They are then paid in full. During this time, you won't face consequences like interest, late payment penalties, collection calls, and wage garnishments.

And if all else fails, you can have a trustee file for personal bankruptcy. It's not ideal, but it's better than continuing to fight debt or following through on false promises with predatory lending practices.

You should never look for a magic bullet when it comes to debt. It's not just because these simplest options promise too much or outright lie about what they can do. It's also because they won't fix the problems that put you in debt. If you still have bad habits, you may find yourself in trouble in a few years. With a licensed bankruptcy trustee, you can settle your debt and get out.

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