Debt Reduction Tips - Consider Your Debt Relief Options in 2010

The year 2010 is one in which the economy has just gotten used to the greatest recession of our times. Earlier when the recession hit the market the federal government realized that the finance industry would be badly hit. Many financial institutions would go bankrupt as their debtors were unable to repay their loans. Such a collapse of the finance industry would have a damaging effect on other industries and the economy as a whole. In order to prevent this, the federal government offered generous financial help to the financial institutions in the form of stimulus money. This money averted the immediate collapse of many money lending institutions and they started to pass on this benefit to the debtors in the form of debt settlement options.

This trend of liberal settlement programs continues in the current year. There are many ways which you can utilize to reduce your debt in this year. If you are burdened with loans and are unable to repay them you can opt for debt settlement. You can either personally approach the creditor or have a settlement company do so on your behalf. You can negotiate the loan amount with the creditors and reduce it considerably. This amount can then be paid as a lump sum or in installments. You can also request the creditors to reduce the interest rate on the amount payable and waive off the penalty charges. But in order to qualify for a settlement program, you should have at least $10,000 as debt. The procedure of settlement brings down the total amount payable to almost 50% of the original amount.

If you do not qualify for settlement however, there are other options available. You can pay off several high interest loans with a single low interest one. This procedure is called debt consolidation. You can also convert your unsecured loans into secured ones. The interest rates on secured loans are always much lower than unsecured loans because there is some collateral attached to them. All these options can be made use of to reduce debt in the year 2010.

Finding legitimate debt settlement companies is not that difficult but consumers must know where to look. It would be wise to utilize a debt relief network that will qualify the companies for you and ensure that they are legitimate and have proven themselves. To locate the top performing debt settlement companies in your state check out the following link: