Detroit Debt Settlement
Debt Settlement in Detroit is a method of relieving debt that thousands of consumers throughout Michigan have used to clear their names of unsecured debts such as credit cards and personal loans. If you’re struggling to keep up with monthly payments, negotiating a settlement with your creditors could be the best option for getting you financially back on track.
Detroit Debt Statistics & Laws
The city of Detroit filed for bankruptcy in 2013, with an estimated $18-$20 billion in accrued debts at the time. Through Detroit, the average household income is around $26,000, one of the lowest of any city in the United States, but is also in the top 5 for lowest average credit card debt per resident.
The Statute of Limitations in Detroit, Michigan is 6 years for all types of debts. This means that a creditor has up 6 years to legally collect on an unpaid account from a debtor.
Five Methods for Relieving Debt in Detroit, Michigan
In Michigan, there are a number of different routes that consumers can take to relieve their debts. These are some of the most commonly utilized debt relief methods.
Balance Transfer Credit Cards in Detroit
Balance transfer credit cards offer debtors the option of moving their unsecured debts to a loan with lower-interest. If a debtor can qualify for one of these cards, they can use that credit to pay off their existing unsecured debts, leaving them with a monthly payment that can be substantially lower due to reduced interest rates. The main drawback with balance transfer cards is that they can be difficult to qualify for without an average to good credit score, a requirement which many taxpayers in deep debt may not be able to meet.
Detroit Debt Management or Credit Counseling Programs
With a debt management or credit counseling program in Detroit, a debtor can work an agency to organize their monthly payments and possibly get the interest rates reduced. With a debt management program, a single monthly payment is made to the counseling agency who then distributes the payments amongst creditors. Credit counseling agencies may also be able to negotiate lower interest rates with creditors during this process. The biggest downside with debt management is that it can’t reduce the principal balance of a debt.
Detroit Debt Consolidation Loans
Debt Consolidation is a form of debt relief that involves taking out a larger loan with a low-interest rate to repay other unsecured debts that have higher interest rates. With a lower interest rate, a debtor will lose less capital to interest throughout the duration of the repayment. Consolidation is also beneficial in that it can help organize your debts by combining many or all of them into a single monthly payment.
Consolidation loans work to reduce the amount lost in interest, but they do not work to reduce the principal debt balance as some other debt relief methods do.
Debt Settlement or Debt Negotiation in Detroit
Detroit Debt Settlement is different from both consolidation and counseling in that it can work to reduce the principal debt balance in addition to negotiating lower interest rates. So, a settlement can reduce the amount that a debtor has to pay in interest and lower the original debt that they were trying to repay by up to 50%.
Debt Settlement can be one of the quickest paths to attaining financial freedom from debt. However, in some cases, creditors may simply not be willing to negotiate a debt anymore, leaving a debtor with little to no other options other than bankruptcy.
Filing for Bankruptcy
When a consumer files for bankruptcy all collection efforts stop, but a debtor may still have to repay all or some of their debt depending on which type of bankruptcy is filed. Bankruptcy often does more damage to your credit score than settlement does as well, but it can be a viable option for those with creditors who are past the point of negotiation.
How Debt Settlement Works in Detroit
Debt settlement is a form of debt relief that involves negotiating a lump sum payment with creditors to repay a debt. This payment can amount to much less than the original amount owed with debtors only having to repay 40-50% of the principal debt in the best-case scenarios. Once the creditor has received the full payment, the debt is considered to be repaid.
Generally, creditors will agree to negotiate a settlement rather than losing the entire debt in a bankruptcy proceeding.
Benefits of Negotiating Debt in Detroit with New Era
- No upfront or add-on fees. Debt settlement is a service that can only be legally charged for after the debt has been settled. Companies that charge a debtor for anything before this are breaking the law. With New Era, you only pay a fee after the debt has been fully settled.
- All-in-one service. Many settlement agencies are only sales groups that pass their clients along to another company to handle the settlement. This means that multiple parties are getting access to your financial information and the sales group may have little or no control how the settlement turns out in the end. At New Era, we handle cases from beginning to end.
- Experienced settlement firm. New Era Debt Solutions has over 20 years of experience and has settled over $250,000,000 in debt for our clients. Over the years, our firm has built a track record for success because of the relationships we’ve built with creditors which allow for the best settlement deals to be reached. Check out our client testimonials to get an idea of what it’s like to work with our programs.
Get Freedom From Detroit Debt Today
If you’re in need of debt help in Michigan, contact New Era for a free analysis with a debt expert. Let us show you how much time and money you can save with the right type of debt relief solution for your financial needs. Contact us at New Era Debt Solutions to figure out your options for debt relief in Detroit.