Bad Credit Debt Repayment Assistance From Counseling Agencies–Are Affordable Payment Plans Available Without Loans?

Economic factors in some areas have seen little improvement as there are some states who are facing unemployment rates of well over 9.2% and, for some, unemployment is in the double digits.  Also, consumers have also reportedly seen increases in overall credit card debt which is being carried at the present time, and in an economy where jobs are difficult to come by, some consumers have seen their credit score drop as a result of missed payments and are now looking for affordable debt relief options. What many of these bad credit borrowers often turn to are debt consolidation loans particularly for bad credit borrowers, which are usually offered through secured loan options, but there may be alternatives to loans entirely that may help bad credit borrowers repay various obligations.

This is where credit counseling agencies may be able to help bad credit borrowers and, despite the fact that consumers may have reservations about using some form of outside assistance, there are some men and women who have benefited from nonprofit credit counseling or even a debt management plan. While these topics are not new, there are more consumers who are finding themselves in stressful financial situations in their personal life due to high levels of unemployment or job opportunities that may be a step down from where they previously happened to be.

Yet, what a credit counseling agency may be able to offer bad credit borrowers comes through either counseling that will help these consumers get their finances back on track or, if certain factors within the life of the consumer make simple counseling unhelpful, there are management plans that may be helpful for a consumer as these programs will negotiate lower repayments on debt obligations with various creditors.

While it goes without saying that any consumer who decides this particular route is right for them will need to do a great deal of research to make sure that their credit counseling agency is reputable and will be helpful for their situation, bad credit borrowers may also run into problems if their poor credit score is the result of a long history of debt mismanagement. There are some creditors, like credit card lenders for example, that may have hardship options available directly to consumers and, in these situations a credit counseling agent or debt management plan may be unnecessary, but when it comes to negotiating debt payment reductions in a debt management plan, if a consumer has a history of missed payments it could be more difficult to reach an agreement.

However, debt counseling agencies may be able to simply point out problems in the financial life of the consumer that will allow them to meet their payment obligations without debt settlement but if a debt settlement plan is required, consumers need to look at how it will impact their personal life. While there are some advisers who say that debt management may be viewed more favorably by future lenders as opposed to settlement where a percentage of the debt is discharged, consumers in a bad credit position have benefited in the past from simply contacting their creditors or a credit counselor and have attempted to pay off what they owe without using debt consolidation or debt management, as these options may cause overall costs to increase. Yet again, these plans are not for every consumer and will need to be carefully reviewed by each bad credit borrower as there are some situations that may have a simpler solution while others may require more extreme measures.