Finding yourself in a debt trap? Life is tough enough. Throw in unmanageable debt and it becomes truly unbearable. Fortunately for many Australians, there are plenty of financial agencies that you can use in order to restructure your debt and manage it more effectively. Whatever the amount of debt that you have accumulated, it is very important to ensure that it is effectively managed so as to keep it under wraps and ensure that your credit rating is well protected. Failing to do that is going to throw you into a financial spiral from which it would be difficult to disentangle yourself from. Some of the debt relief solutions for unmanageable debt that you could use include debt consolidation, debt agreements, personal insolvency agreements, and bankruptcy amongst others.
It is important to hire reputable debt advisors such as Debt Mediators in order to assist you in analyzing your debt situation and recommending the best course of action that will put your debts under control. Managing debt can be especially difficult if your financial situation is not stable and prone to change. With time, you will continuously experience an inability to meet your expenses which further create blots on your credit files that only exacerbate an already bad financial situation. Here is a look at some of the debt relief solutions for unmanageable debt that you could consider based on the recommendation of your debt advisor in order to help you break free from debt:
This is one of the most popular debt relief solutions for people with unmanageable debt. If you have a fairly good credit history or even a bad credit history, you could consolidate all your debts into a single manageable debt under a consolidation plan. You could even get a new lower rate under a well negotiated consolidated plan. Consolidation is generally carried out in order to lower the interest rate and reduce the number of monthly repayments so as to make your debt more manageable. For example, you could consolidate 6 credit cards into a single loan.
You can propose debt agreements to your creditors if you are no longer able to meet your monthly repayments. You can only enter into a debt agreement if you have been struggling with your finances for quite some time. You will propose an arrangement to your creditors where you agree to pay them a certain amount over some time. The time duration can range from 3 to 5 years. The advantage with debt agreements is that you can have parts of your debt written off or settle for less than you owe. The big advantage with a debt agreement is that it is not a bankruptcy and is actually a legally recognized bankruptcy alternative that you can use as debt relief solutions for unmanageable debt.
Personal Insolvency Agreement
This is one of the most flexible options for dealing with unmanageable debt, but the debt amount must be more than $120,000. The process of personal insolvency agreement must always be overseen by a Trustee who will be the administrator of the debt. It is a generally more formal option compared to the Debt Agreement.
If you are insolvent and are unable to make repayment arrangements with your creditors, then you can file for bankruptcy. It must be emphasized that this should be considered as a last resort since it often carries serious repercussions for the debtor. For example, you will practically be handing the control of your finances to a Trustee over the duration of time.
For more debt management options, check out Debt Mediators debt relief solutions for unmanageable debt at HTTPS://WWW.DEBTMEDIATORS.COM.AU/.