Pros and Cons of Resolving Debt on Your Own
Debt can be a scary thing, but it is also a part of everyday life for many.
Whether it’s a mortgage, a car loan, credit card debt, student loans, or medical debt, you’ll be hard-pressed to find someone who doesn’t have some form of debt. But there is a difference between good debt (manageable debt that you can comfortably pay down each month) and bad debt (debt that has become unmanageable, gone into collections, etc.) Depending on how much debt you have and the kinds of debt, you may find yourself needing to take extra steps towards paying it down. But how do you know when you should ask for professional help? Here are some pros and cons of resolving debt on your own.
- You can teach yourself better financial habits. Tackling your debt will require you to buckle down and get down to business. In order to resolve debt on your own, you’ll need to set some financial goals (short- and long-term), evaluate your spending habits (and where you can improve), create or reevaluate your budget, and closely monitor your accounts and credit report. All of this will have long-term benefits on your financial health!
- You can avoid getting scammed. The ugly truth about the debt resolution industry is there are a lot of people looking to take advantage of people in desperate situations. Many (though not all!) debt settlement and debt consolidation companies have questionable practices. This can end up doing you more harm than good. Unfortunately there are not many regulations in place to help consumers weed out the bad ones. Alternatively, a trustworthy law firm can offer many of the same benefits of other debt resolution companies, but are held to a higher ethical standard.
- You may be in need of legal assistance. In many cases, long-standing unresolved debts can lead to legal implications. This could be a judgement against you or a lien against your property. A judgment is a type of lien that is attached to a debtor’s real or personal property without their consent. The judgment is intended to pressure a debtor to transfer money to a creditor through a court’s enforcement. Something like this can be very frightening and stressful. However, a respectable law firm is experienced and proficient in resolving judgements in a number of different ways.
- You may not save as much money. You may find you are able to get the basics (budgeting, curbing your spending) down. But did you know you may be able to satisfy your debts for far less than you actually owe? An experienced debt relief service can negotiate with creditors on your behalf. They’ll work to save you money and work with you to ensure your debt resolution success.
- Creditors may not be willing to work with you. Many creditors are reluctant to negotiate directly with consumers and will only offer hardship programs that last a few months and do not actually result in resolving your debt for less. By hiring a dependable law firm with trustworthy attorneys and an experienced staff, debt negotiation and resolution can be a far less time consuming process and may yield better results.
Each case of debt resolution is different. What may be a manageable recovery for one person may not be the case at all for another. You may be in a position to resolve your debts fairly easily on your own, or you may decide it’s in your best interest to ask for some help. If you are still unsure, consider contacting Tayne Law Group for a free phone consultation. We can help answer your debt resolution questions and help you determine if you would benefit from our services.